Micron: First Healthy Pullback Since Breaking Out
Chip stocks have been the strongest corner of the market for the last year. Now one of the most actively traded names in that group has had its first healthy pullback since breaking out to new 52-week highs: 
Micron Technology.
MU has been working its way through an 18-month consolidation pattern following a huge run between mid-2016 and mid-2018.
It broke out to a new 52-week high in mid-December as the market flew into new territory but remained below the previous peaks from 2018. The risk/reward wasn't great, even as MU kept chopping higher, but now it's pulled back to some key levels and may offer a cleaner opportunity.
Two important things stand out on MU's chart: The 50-day simple moving average (SMA) and the recent low around $52.50. Both provide a good risk-management zones for buyers seeking a move back toward $60.
Fundamentally, most indications have remained positive for
semiconductors. MU CEO Sanjay Mehrotra called a bottom for memory chips in December, and Intel's (INTC) surprisingly bullish report on January 23 showed orders are still strong. There's also the forward catalyst of 5G networking.
Micron Technology.MU has been working its way through an 18-month consolidation pattern following a huge run between mid-2016 and mid-2018.
It broke out to a new 52-week high in mid-December as the market flew into new territory but remained below the previous peaks from 2018. The risk/reward wasn't great, even as MU kept chopping higher, but now it's pulled back to some key levels and may offer a cleaner opportunity.
Two important things stand out on MU's chart: The 50-day simple moving average (SMA) and the recent low around $52.50. Both provide a good risk-management zones for buyers seeking a move back toward $60.
Fundamentally, most indications have remained positive for
semiconductors. MU CEO Sanjay Mehrotra called a bottom for memory chips in December, and Intel's (INTC) surprisingly bullish report on January 23 showed orders are still strong. There's also the forward catalyst of 5G networking.
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