Palantir Stock Price Levels to Watch After Post-Earnings Surge

Shares of Palantir ( PLTR ) traded sharply higher in extended trading Monday after the analytics software provider beat third-quarter estimates and raised its full-year revenue outlook amid strong demand for its artificial intelligence (AI) offerings.

In particular, the company cited demand for AI from government and commercial customers, adding that it expects the rapid adoption of its platforms and AI capabilities to drive future growth. Palantir shares have more than doubled year-to-date through Monday’s close, fueled in part by the stock’s recent inclusion in the large-cap S&P 500 index.

Palantir shares rose 14% to $47.09 in after-hours trading Monday.

Below, we analyze the technical aspects of Palantir’s chart and identify important post-earnings price levels to pay attention to.

Expansion of breakout formation

Since breaking above the flag pattern in early September, Palantir shares have trended sharply higher for about a month before consolidating within a broadening formation.

Before the company’s quarterly results came out, sellers moved into the stock, but bulls successfully defended the formation’s lower trend line, with trading volume hitting its highest level since early October on Monday.

Amid the stock’s expected earnings-driven breakout above the expanding formation on Tuesday, let’s identify several key overhead levels that investors may be watching and point out an important support area to watch during periods of profit-taking.

Key general levels to monitor

The first sits around $45. Although the stock is poised to open above this level on Tuesday, it is worth watching for a close above this price located near the stock’s all-time high (ATH) and the upper trendline of the expanding formation.

To view a trailing price target above a stock’s ATH, we can use a bars pattern, which is a charting technique that uses past price action to predict future moves. In this case, we take Palantir’s September-October directional movement and cover it from the lower trend line of the extended formation, which forecasts a target of around $60.

We chose this prior trend because it starts from the bottom trendline of a consolidation pattern – the flag – and included a double-digit percentage jump early in this move, which would be consistent with how an earnings-driven rally in the stock might occur.

An important support area for surveillance

During periods of profit-taking, investors should keep a close eye on the support area between $41 and $38, as the stock may attract buying interest from the lower trend line of the expanding formation and the September high.

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As of the date of writing this article, the author does not own any of the securities mentioned above.