Micron stock chart: key levels to know before the report

Given the state of tech stocks and the broader market, it’s no surprise the race has been mixed for Micron. (MU) – Get the report from Micron Technology, Inc..

Shares of the chipmaker rose 2.25% on Monday and gained as much as 3% on spread action this morning. This action precedes tonight’s quarterly earnings report after the close.

Micron is a closely watched stock when it comes to earnings. This is due to a number of factors.

First, it doesn’t earn profits when most other tech stocks do, so it can provide some interesting intra-quarter color.

Second, Micron is a major manufacturer of NAND and DRAM products. Management’s insights give us insight into where the rest of the chip and memory industry is headed.

These comments are often extrapolated to stocks like Advanced Micro Devices (AMD) – Get Advanced Micro Devices, Inc.Nvidia (NVDA) – Get the NVIDIA Corporation reportIntel (INTC) – Get Intel Corporation report and others.

By all accounts, Micron is expected to report earnings, and with today’s rally, it breaks through some key levels. The question is, can the stock build on this momentum after the print or will it drop these levels?

Micron stock trading

Micron stock daily chart.

Scroll to continue

Near today’s high, Micron stock was trading near the middle of its current range – just off the 50% retracement.

This puts traders in a tough spot ahead of the quarter. That’s why I prefer to wait for post-earnings action to see how the stock reacts at key levels.

On the other hand, Micron just broke through the $80 zone, a critical zone over the past month.

Not only did it hit last week’s high, but it also wiped out the 21-day and 200-day moving averages. If we get a bearish reaction, this will be the first area the bulls look to for support.

If it’s lost – or Micron’s stock is simply lower than it – the $75 zone becomes key. It was supportive all last week, with Micron bouncing back from this area in four out of five sessions.

Below that opens the door to the fill level near $73.50, followed by the $68-$70 area.

On the upside, let’s see if a bullish response can lift Micron stock to this week’s high and the 50% retracement.

If so, this quickly opens the door to the 50-day moving average and the 61.8% retracement.

On a move above the latter, we could be looking at a rally into the $90s, eventually bringing into play the $95-$97 resistance zone.

Karen J. Nelson