What’s happening?
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Heavy recent drop: Palantir plunged ~9–9.4% on Tuesday (August 19), marking its worst daily drop in the S&P 500 and extending to a five-day losing streak, amounting to a 12–15% pullback from its August 12 all-time high of $190.
Why the slide?
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Valuation concerns: Palantir's valuation sits at ~214 times forward earnings—well above the S&P 500 average (~22×) raising alarm among analysts.
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Profit-taking after a strong run-up: The stock has soared ~118% YTD (and ~409% over the past year), prompting investors to lock in gains Barron's.
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Short-seller pressure: Andrew Left of Citron Research called Palantir “detached from fundamentals,” suggesting a valuation closer to $40—a sharp contrast to current levels.
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Broader tech sell-off and AI fatigue: The decline is also tied to caution around AI hype and elevated tech valuations, impacting other names like Nvidia.
Mixed analyst sentiment: Only a minority of analysts rate PLTR a “buy” (e.g., 7 out of 29), with price targets ranging widely from as low as $45 to as high as $210.
Is it just a pullback or something bigger?
Signs point to a healthy pullback rather than the end of Palantir’s upward journey:
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The selling has clear catalysts—valuation concerns, profit-taking, and AI-related caution—suggesting a natural market correction after a torrid rally.
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Some technical insights suggest price levels around $155 (resistance) and $153 support as key zones to watch .
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There’s no indication of a severe structural breakdown—just a resetting phase amid overheated sentiment.
Quick Trading-Assistant Snapshot
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Insight: $Palantir Technologies Inc.(PLTR)$ appears to be undergoing a classic pullback after strong gains—motivated by valuation pressures, short-seller commentary, and broader tech sector weakness. It hasn’t collapsed—it’s resetting.
Key Levels:
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Resistance near $160
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Support around $153–$155
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Deeper support may emerge near $131–$142 if momentum continues downward .
Options / Strategies:
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Short-term traders: Consider long positions or call options on dips toward support, with tight stops—say below $153. Potential targets in the $160–$165 range .
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Value-oriented or cautious investors: A pullback toward the average target (~$127.50) could offer a lower-risk entry point .
Long-term thesis: While overvalued now, Palantir still holds strong government and commercial contracts plus AI tailwinds. Still, pay attention to cyclical volatility and sentiment shifts .
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Disclaimer: This is not trading advice. Always conduct your own analysis and risk management. Markets are fluid, and past performance doesn’t guarantee future outcomes.
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