FX

Palantir Technologies (PLTR): Stock Price and Forecast: Why Palantir fell so much on Tuesday?

  • Palantir stock collapses nearly 8% on Tuesday.
  • PLTR is down below $26 after a steep fall.
  • Palantir stock (PLTR) falls to the 200-day moving average.

Palantir stock (PLTR) suffered disproportionally on Tuesday with a serious 7.75% fall to close the session out at $25.34. While markets were weak overall and the Nasdaq suffered the most, Palantir really took a hammering. The stock did not have any specific bad news that we can see but rather was caught up in the “high growth does not like high rates” argument and took a large hit accordingly. Many high-growth stocks were badly hit as yields did rise above 1.5%. As mentioned the Nasdaq was the worst performing index on the day. But there are also other reasons at play for PLTR stock’s steep fall. Firstly it has had a good run and is not suffering from some profit-taking. This may be why ARK Invest is selling some (admittedly a small portion of it holding) and investors did dump high growth names across the board, especially ones that had outperformed. Just look at UPST dropping nearly 6% on Tuesday. Previously this stock had seemed bulletproof to losses.

Added to that was the bearish double top we had sagely identified and this has played out perfectly. Easy to say with hindsight but looking back we did call this one quite early and as those of you with a chart interest know, a double top is one of the strongest patterns.  Palantir (PLTR) set a double top at just over $29 on September 17 and 23. The retracement was set to $26 meaning a break of $26 set the target at $22.70. 

Palantir key statistics

Market Cap $53.6 billion
Enterprise Value $47.8 billion
Price/Earnings (P/E) N/A

Price/Book

33
Price/Sales 45
Gross Margin 0.7
Net Margin -0.95
EBITDA TTM -$1.24 billion TTM
52-week low $8.90
52-week high $45
Short Interest 3.1%
Average Wall Street rating and price target

HOLD $24.61

Palantir (PLTR) stock news

Not too large but news does hit the wires that Palantir has won a $2 million Department of Defense contract for “Army Prognostics & Predictive Maintenance Prototype” according to Benzinga. Palantir does have strong customer links to the US government and this further demonstrates that.

Palantir (PLTR) stock forecast

We identified the double top and the trigger at $26. Now that $26 has been broken, the double top is activated with a target the size of the first decline, $3.20. So the target is $22.70. Yesterday saw PLTR decline rapidly to the area of strong volume on the volume profile bars and also the Volume Weighted Average Price (VWAP) for the year 2021 at $25.53. So a bounce really should be on the cards for Wednesday after such a sharp fall to a high volume area. However, remaining below $26 keeps Palantir (PLTR) bearish. 

FXStreet View: Bearish below $26, neutral $26 to $27.49.

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