Pullback long, target 42Following in different time frames.
Daily, I got a long signal from my power indicator.
For weekly, I got a bottom signal. If I combine these 2 signals, I can see that it might be a pull-back signal in a monthly timeframe.
Then I put fibo levels and that shows me 42.18
My target is 42.
I'd stop under 20.
I hope it'll not open with a huge gap. If it occurs, I'd need to wait for lows.
Smcitrading
$SMCI surged by 78% ! A comeback or final rally?
Technically, NASDAQ:SMCI is overall moving in a bearish market, and it just be rejected by the resistance level of downtrend line and the high price of previous gap down candle with high volume.
In this case, the price may continue to go bearish if it could not break above the resistance level.
From the aspect of fundamental analysis, there is also a high possibility for NASDAQ:SMCI to go bearish due to the two reasons below.
Evident 1:
SMCI’s drop was driven by financial fraud, with its auditor, Ernst & Young, resigning. Additionally, NVIDIA is shifting its orders away from SMCI. And the price had a short-term callback since the company only recently found a new auditor, BDO, and submitted a compliance plan to Nasdaq.
It’s worth mentioning that NASDAQ:SMCI has experienced a similar situation before. Back in 2019, SMCI faced multiple delisting warnings from Nasdaq for failing to submit its 10-K report and other financial documents on time. Ultimately, SMCI was delisted for not meeting reporting requirements and moved to the over-the-counter market to continue trading. After improving its internal controls and financial reporting, SMCI was able to rejoin the exchange in 2020.
Evident 2: NASDAQ:SMCI doesn’t have any monopolistic products and its offerings are highly replaceable. Several auditing firms have been gradually lowering their ratings and pricing since August, and SMCI has long been heavily dependent on NVIDIA's GPU chips. This dependence is evident, as about 70% of SMCI’s production costs rely on NVIDIA components. Now that NVIDIA is shifting its orders to other suppliers, even if SMCI has found a new auditor and successfully submits a strong Q3 report, its future will largely depend on whether NVIDIA decides to return its orders.
Therefore, the recent surge over the past few days could be due to NASDAQ:SMCI creating a breathing space for itself, namely by submitting a compliance plan to Nasdaq. Regardless of whether it can meet the requirements, submitting the plan serves as a temporary measure to buy time. This move has sparked market enthusiasm, but that enthusiasm is likely to fade. If NVIDIA does not shift its orders back and if SMCI ultimately fails to submit compliant financial reports as outlined in its plan, the recent rise in stock price may turn out to be a short-lived rally, or what could be called a final dance.
The Big Exit | How One Auditor Walked Away from Super MicroThe Governance Shortfall: Inside Super Micro’s Auditor Crisis
On Wednesday, shares of the high performance server and storage solutions provider faced renewed selling pressure after the unexpected resignation of its audit firm, Ernst & Young LLP(EY)
In July 2024, EY alerted the Audit Committee about several concerns related to governance, transparency, internal controls, and the risk of delayed filing of the company's annual report. In response, the Board formed an independent Special Committee to investigate these matters, engaging Cooley LLP and forensic accounting firm Secretariat Advisors, LLC. Although EY and the Board received preliminary updates on the investigation, the final conclusions have not yet been shared.
The ongoing review raised doubts for EY regarding the company’s adherence to the COSO Framework principles for internal controls. EY questioned the company’s commitment to integrity, the independence of the Audit Committee, and the reliability of management’s and the Audit Committee's representations.
In its resignation letter, EY expressed its inability to rely on these representations or be associated with the company's financial statements, citing legal and professional obligations.
Despite the developments, Super Micro has indicated no expected changes to previously issued financial statements. The company plans to provide a Q1/FY2025 business update next week. However, it’s surprising that management didn’t include preliminary Q1 results in Wednesday's announcement, which could have mitigated the negative impact on its stock.
Super Micro is nearing a Nasdaq deadline to either regain compliance with listing requirements or submit a plan. With the auditor’s unexpected departure, it may be difficult for the company to present a viable plan, raising the risk of a near-term delisting.
This resignation comes at a critical time for Super Micro, as its rapid growth requires substantial working capital. Based on management’s projections, FY2025 cash needs could reach up to $3 billion, likely necessitating additional capital early next year. However, raising funds without audited financials could be challenging, potentially forcing Super Micro to relinquish market share to competitors like Dell Technologies or Hewlett Packard Enterprise.
In my view, EY’s departure increases the likelihood of a prolonged accounting review, which could hinder Super Micro’s ability to secure funding for anticipated growth. Therefore, it is crucial for the company to report strong preliminary Q1/FY2025 results and present a positive outlook next week.
Super Micro Computer’s troubles continue, as its auditor resigned due to concerns over management’s integrity and the Audit Committee's independence. This situation makes it unlikely for the company to achieve compliance with Nasdaq requirements soon, raising the potential for a near-term delisting.
With a need to re-enter the capital markets in early 2025, audited financials remain essential. A failure to secure funding could result in significant market share loss to major competitors like Dell Technologies and Hewlett Packard Enterprise.
Given these challenges, the increased risk of prolonged financial review, and a likely near-term delisting, I am reaffirming my "Sell" rating on Super Micro Computer's common shares.
SMCI Is it a buy after -35% dip and the leave of their auditors?Super Micro Computer is oversold on all timeframes and is approaching that level even on 1W (RSI = 35.160, MACD = -7.190, ADX = 44.214). The reason for the -35% daily collapse is of course the resignation of their auditors, Ernst & Young, which have raised concerns over SMCI's governance since late July. News have even hit the market that there are fears of delisting. Now fundamentally, even though the street has seen its fair share of accounting frauds in the past, those make up only a tiny minority.
Normally when such pessimistic news hit the market, long term investors should be viewing the dynamics objectively. Is it worth buying despite all the negatives? A quick answer can be given by just looking at the technicals. Any high cap stock that falls roughly -75% from its All Time High (ATH) is objectively a great long term investment opportunity.
For SMCI in particularly it has almost lost -75% of its value in 8 months, with the company absorbing almost any negative news there could be out there. The price is right now at $33.00 with its 1W MA200 currently sitting at $22.95 (and rising), which is the long term support since April 20th 2020. Before that trendline, there is the HL 2 to consider that started on July 5th 2022. In the meantime, the 1W RSI is testing sideways the S1 Zone, a buy level that is holding since July 2015.
It has to be said that the -75% decline is SMCI strongest within such period of time, with the most recent before it being during the U.S.-China trade wars (October 1st 2018 at -68.30%). That collapse recovered in 6 months as it reached its 0.786 Fibonacci level.
If SMCI announces soon their new auditing firm and calm the market about their practices, there is a strong probability to see the price testing the current 0.786 Fib (TP = 90.00).
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IS SUPER MICRO COMPUTERS ($SMCI) FINALLY BOTTOMING?! IS SUPER MICRO COMPUTERS ( NASDAQ:SMCI ) FINALLY BOTTOMING?!
3 REASONS WHY:
1⃣ We have DIVERGENCE on the Weekly Chart
2⃣ It's almost a "High Five Setup"
3⃣ Take a BREAK and find out by watching. 👇
Stay tuned for more!🔔
Like ❤️ Follow 🤳 Share 🔂
Will Super Micro finally get back on track after the insane negative sentiment and news articles?!
Not financial advice.
SMCI: Are we back in business??Super Micro Computer just broke over the LH 1 trendline holding since July 15th and is about to turn bullish again on the 1D technical outlook (RSI = 54.296, MACD = -2.380, ADX = 24.033). Coming off a double bottom (DB), the only resistance left before the bullish trend is resumed, is the 1D MA50 (untested since July 17th). The 1D RSI already made its breakout over its own R level. When the 1D MA50 breaks, target the LH2 trendline (TP = 78.00).
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Super Micro Computer (SMCI) Faces Securities Fraud LawsuitSuper Micro Computer Inc. (NASDAQ: NASDAQ:SMCI ) is navigating turbulent waters as the company faces a class action lawsuit alleging violations of federal securities laws. The Schall Law Firm, a national shareholder rights litigation firm, has filed a lawsuit against Super Micro for potential violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as well as Rule 10b-5. The litigation involves accusations of misleading investors and possibly inflating financial figures. Shareholders who purchased SMCI securities between August 10, 2021, and August 26, 2024, are urged to contact the law firm before the October 29, 2024, deadline.
Despite the legal headwinds, Super Micro’s stock is making waves ahead of a highly anticipated 10-for-1 stock split, which is scheduled to take effect after the closing bell on September 30, 2024. On the technical side, the stock has rebounded by 4% in recent trading, signaling renewed investor interest. However, the company has lost nearly half of its value over the past three months, weighed down by disappointing fiscal Q4 earnings and allegations of “accounting manipulation” by short seller Hindenburg Research.
Legal Troubles and Market Sentiment
The class action lawsuit represents a major challenge for Super Micro Computer as it grapples with accusations that could severely damage investor confidence. Violations of securities law can lead to significant penalties, reputational damage, and a prolonged legal battle, all of which could negatively affect the company’s stock price.
Adding to these troubles is Hindenburg Research’s scathing report, which alleges that the company engaged in improper accounting practices, contributing to the stock's volatility in recent months. This report has stirred skepticism among some investors, although others remain focused on Super Micro’s long-term potential, particularly in the fast-growing artificial intelligence (AI) server market.
Technical Analysis: Key Levels to Watch
Despite these setbacks, NASDAQ:SMCI stock is attempting to recover from its sharp decline and has recently shown some signs of life. On Monday, the stock rose by 1.78%, trading at a relative strength index (RSI) of 43, indicating that it is emerging from an oversold condition, but still showing some weakness. The RSI remains below 50, suggesting that NASDAQ:SMCI is still working to overcome bearish momentum.
SMCI’s price movement has been oscillating within a descending broadening wedge formation since reaching its all-time high in March 2024. This pattern is often viewed as a bullish reversal signal once a breakout occurs, but so far, the stock has struggled to maintain upward momentum. The lower trendline of the wedge around $357 has held as key support in recent weeks, and a failure to defend this level could send shares tumbling toward $230, where previous troughs were established between August and October of last year.
On the upside, the stock faces significant resistance around $700, a level that aligns with the 200-day moving average. A breakout above this resistance could trigger a rally toward $975, a price level that corresponds with several swing highs from earlier in the year.
AI Server Demand and Innovation
While Super Micro (NASDAQ: NASDAQ:SMCI ) grapples with its legal issues, the company still holds substantial promise as a first mover in AI server infrastructure. The demand for AI server technology, particularly liquid cooling rack systems, is expected to surge as artificial intelligence applications grow. This market opportunity has led analysts at Needham to issue a “buy” rating for SMCI, with a price target of $600, which represents a potential upside of 31% from the stock's current price of $457.27.
Super Micro’s expertise in high-performance computing solutions positions it well to capitalize on the rising demand for AI servers. The company's AI-focused products, including its liquid cooling rack systems, are seen as cutting-edge technology that could play a crucial role in addressing the growing data needs of AI workloads.
The Path Forward: Legal Risks vs. Market Potential
As SMCI prepares for its stock split and navigates its legal battles, investors will be watching closely to see how the company balances the risks of the lawsuit with its promising opportunities in the AI server market. The ongoing legal challenges could weigh on the stock in the short term, but the company’s innovative technology and growing demand for AI infrastructure offer long-term growth potential.
For investors, key technical levels such as $357 and $700 will be important markers for determining whether the stock can regain its footing or continue to slide. With the stock split and lawsuit on the horizon, Super Micro Computer remains a stock to watch closely in the coming weeks.
Conclusion
Super Micro Computer Inc. (NASDAQ: NASDAQ:SMCI ) finds itself at a critical juncture. The class action lawsuit for potential securities fraud, coupled with accusations from Hindenburg Research, presents significant risks. However, the company’s forward-looking focus on AI servers and liquid cooling systems provides a compelling case for long-term growth. As the stock split nears and legal proceedings unfold, investors should keep a close eye on both the technical price levels and any updates on the lawsuit, as these factors will heavily influence SMCI’s trajectory in the near future.
SMCI to get back up to 1000$ ?SMCI has an awfully similar chart to PLTR, both of them hit all time highs, and then crashed. Smci is now at its all time lows and is going to stay there for a bit. PLTR on the other hand, did hit an all time high and also fell. But, it has recovered and is on track to hit all time highs again. I think that SMCI is going to trace the chart of PLTR and go back to around 1000$-900$. Both companies had a big boom and at the top, were overvalued, and came crashing down. NVDA might be experiencing the same.
SMCI: Strong accumulation. Buy it while you can.Super Micro Computer is neutral on its 1W technical outlook (RSI = 53.442, MACD = 90.250, ADX = 30.355) and the reason is that below the 1W MA50 it is expanding the new Cycle's accumulation phase. Every Cycle experienced this accumulation under the 1W MA50, sometimes shorter others longer. Technically, on a two year basis, every time it crossed under the 1W MA50 and consolidated, the stock was a buy opportunity.
The trigger to buy is given on the S1 level (50.60) of the 1W RSI. The last two Cycles grew by at least +400% from the first low that followed the crossing under the 1W MA50. Consequently we turn long on SMCI, aiming for another +400% rise (TP = 3,300).
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