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Fan Yang

Anticipating Support for Micron Technologies (MU) Around $40

When Micron $MU has been rallying in June, I had exited half my position in MU when it reached $40. Price ended up going another 20% to $48 before pulling back. At this point, I am looking to add back my exposure around $38-$40.

MU Daily Chart

(click to enlarge)

Bullish Breakout:
- In 2019, price has been choppily rallying. 
- It broke above a falling channel in February, but pulled back after failing to push above $44.
- However, price held above the 2018 low and bounced off $32. 
- Then, it broke above the $44 resistance as well as the $45.50 area, which was a previous support that could have turned into resistance if the trend were bearish.
- The break above this area thus suggests the market is NOT bearish anymore, and that bulls might be back in charge.
- In this bullish continuation breakout scenario, the $40 area should hold as support.
- Other than a key support/resistance pivot, there is a cluster of 200-, 100-, and 50-day simple moving averages (SMA) right under $40.
- If price does indeed anchor above $40, we can be more confident of the bullish outlook.
- Also, the RSI should hold above 40 in the bullish continuation scenario.
- A break below $36 on the other hand would suggest a bearish continuation outlook.

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