Tremendous Micro Pc (SMCI) shares popped 8% in prolonged buying and selling Tuesday after the troubled server maker stated it expects to submit its delayed 2024 financial reports by the Nasdaq’s Feb. 25 deadline to keep away from being delisted.

This growth overshadowed the corporate’s underwhelming preliminary second-quarter outcomes. It additionally shored up buyers’ confidence within the inventory, laying to relaxation issues that the server maker could not meet the alternate’s cutoff date after a plethora of accounting and corporate governance points had been unearthed in the course of the second half of final yr.

Its been a wild experience for the Supermicro inventory which misplaced almost 10% throughout common buying and selling hours Tuesday and commenced after-hours buying and selling within the crimson earlier than whipsawing. The corporate’s shares have fallen round 6% within the final month however have surged more than 35% in February as of Tuesday’s shut in anticipation of this replace. Nevertheless, the inventory has misplaced almost half its worth over the previous yr.

Under, we break down the technicals on Supermicro’s chart and determine essential worth ranges that buyers could also be watching.

Descending Broadening Wedge Breakout

Supermicro shares broke out above the highest trendline of a descending broadening formation final Friday, doubtlessly additionally forming an inverse head and shoulders bottoming sample within the course of.

Importantly, the inventory registered its highest volume in current buying and selling session since early December, indicating bigger market members positioning forward of this afternoon’s replace.

Whereas the relative strength index (RSI) edged decrease after as we speak’s fall in common buying and selling, the indicator nonetheless confirms bullish worth momentum with a studying just under the overbought threshold.

Let’s apply technical analysis to determine essential overhead areas the place the shares may run into resistance and likewise level out key support levels value watching throughout pullbacks.

Necessary Overhead Areas in Play

The primary overhead space to trace sits across the psychological $50 degree. This area on the chart may present resistance close to the inverse head and shoulders’ neckline, which additionally lies in shut proximity to the downward sloping 200-day moving average.

A decisive breakout above this worth would affirm the sample, which may propel a transfer to round $70. Buyers could look to dump shares round this degree close to the February 2024 pullback low and late-April trough.

Observe-through shopping for may see the shares rally to the $96 degree, an space that will present resistance close to a trendline that connects a collection of peaks on the chart between February and July final yr.

Key Help Ranges to Watch

Throughout retracements, buyers ought to preserve tabs of the $26 degree. Supermicro bulls may search for shopping for alternatives on this area close to the low of the inverse head and shoulders’ proper shoulder.

Lastly, a extra vital draw back reversal within the inventory may see the shares revisit decrease help round $18. Buyers who attempt to time market bottoms could search entry points close to final yr’s November low, which additionally doubles and the inverse head and shoulders’ head.

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As of the date this text was written, the creator doesn’t personal any of the above securities.