Chart of the Day: Palantir Flips the Script

Don’t adjust your screens, that was really a big trading day for Palantir (PLTR). PLTR ripped to the upside following an earnings smash with raised guidance that lifted the stock higher than it has been since January, when it was in free fall. It was an amazing quarter of record-setting earnings for the software company and puts any doubts about their future business to bed.

What is amazing about PLTR is the chart, where an about face occurred and suddenly the bears were torched. The chart is not altogether bullish, but is certainly headed in that direction. That sharp rise Tuesday on heavy volume (best volume day in a year) helped guide the stock to a teal candle, which is cautiously bullish (from a cautiously bearish the day prior). That is impressive. MACD is now on a buy signal, looking for a confirmation day.

Money flow had been surging of late, which we noted recently. The RSI is jammed up and nearly overbought, just a condition though and not a signal to sell yet. A confirmed rally would signal more upside is coming for Palantir. Some would target short-covering for this large move, and that might be right. But big rallies tend to get started from covering shorts, and we think this is where Palantir will do its best work.

The stock is well above its 200-day moving average now, which is important as a marker for institutional sponsorship. That is the place where big money is often ready to add more, and we see that happening recently in the Chaikin money flow.

We like Palantir in TheStreet Pro Portfolio and rate it a One, or “buy at anytime.”

More Pro Portfolio:

At the time of publication, TheStreet Pro Portfolio was long PLTR.