TradingKey - Micron stock plunges nearly 6% in a single day, triggering selling pressure and facing a potential 18% secondary bottom test.
On August 24 Eastern Time, Micron Technology (MU) experienced severe volatility around the $900 mark, plunging 7% intraday to a low of $887.60 before a subsequent rebound narrowed the decline to 5.83%, closing back at $910.43.
The sharp drop in Micron's stock price was not caused by a single factor, but rather a combination of macroeconomic risk aversion and sector competition. Over the weekend, reports emerged that U.S. regulatory policy might allow Apple (AAPL) to source Chinese DRAM and NAND flash memory for certain product lines, sparking panic selling over fears that Micron's supply chain share with a major client could be squeezed by local substitution.
In addition, on the eve of Nvidia's (NVDA) upcoming earnings report, the market fell into a cautious, risk-averse mood, with capital taking profits following previous highs. The chip sector as a whole came under downward pressure, as the Philadelphia Semiconductor Index and peers like Samsung and SK Hynix weakened in tandem, pulling Micron down as well.
Micron stock price forecast, Source: TradingView
Currently, Micron's stock price is showing a technical correction at high levels. On August 17, Micron's stock price broke through the $1,000 mark again, but subsequently continued to pull back, falling back to near $900. This serves as the midline of the recent consolidation range and provides a degree of support.
However, if Micron officially breaks below the $900 support level, technical selling pressure could be triggered, driving the stock further down to test its July 29 low of $740 for a secondary bottom, representing a potential correction of approximately 18%.
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