Palantir Stock Soars on Rosy Revenue Outlook as AI Demand Surges—Watch These Price Levels

Palantir Technologies (PLTR) shares jumped Tuesday after the data analytics software provider raised its full-year outlook amid booming demand for its AI platform. 

The company posted quarterly revenue that surpassed $1 billion for the first time, topping Wall Street estimates, and now expects full-year revenue of between $4.14 billion and $4.15 billion, up from $3.89 to $3.9 billion previously. CEO Alex Karp said Palantir’s commercial business nearly doubled from a year earlier, while its U.S. business grew 68%, which he attributed to “the astonishing impact of AI leverage.”

Following the company’s blowout results, investment banks Bank of America, Morgan Stanley, and Deutsche Bank raised their price targets on Palantir shares. The stock rose nearly 8% to $173 on Tuesday and has gained about 600% over the past year. The stock has been boosted by the company’s increasing business with the federal government and surging enterprise demand for its AI-powered tools. 

Below, we break down the technicals on Palantir’s chart and identify key price levels that investors will likely be watching.

Rising Wedge Breakout

Palantir shares broke out above the top trendline of a rising wedge in Tuesday’s trading session. While this chart pattern often signals a potential trend reversal, a bullish breakout indicates strong price momentum

Moreover, the relative strength index confirms bullish price action, though it also flashes overbought conditions, increasing the likelihood of near-term profit taking.

Let’s apply technical analysis to Palantir’s chart to project an upside target if the shares continue their move into price discovery and also identify support levels worth monitoring during possible retracements in the stock.

Measured Move Upside Price Target

Investors can project an upside target in Palantir shares by using the measured move technique, also known by chart watchers as the measuring principle.

When applying the analysis, we calculate the percentage change of the rising wedge near its widest point and add it to the pattern’s top trendline value. For example, we apply a 22% increase to $165, which projects a target of $201.30.

Crucial Support Levels Worth Monitoring

During retracements in the stock, it’s initially worth monitoring the $148 level. Profit-taking down to this area, currently just below the rising wedge pattern’s lower trendline, could attract buying interest near the June peak.

A decisive close below this level could see the shares retreat to around $125. This location may provide support near the prominent February swing high and a period of sideways drift that formed on the chart during May and June.

Finally, further selling opens the door for Palantir shares testing lower support at $98. Investors may look for entry points in this region near the closely watched 200-day moving average, the March countertrend peak, and the top of a flag pattern that formed on the chart in mid-April.

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As of the date this article was written, the author does not own any of the above securities.