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Key Takeaways
- Corning shares have surged 16% in the past two trading sessions to a three-year high after the specialty glass maker boosted its outlook due to increasing demand for its optical connectivity products used in generative AI applications.
- The rally has occurred on the largest weekly trading volume since February 2018, indicating strong conviction behind the move.
- Given the stock’s impulsive move higher, the price may see an imminent retest of its April 2021 high at $46.82.
- During periods of profit taking, Corning shares may attract buying interest at key chart levels including $39, $35, and $31.
Corning ( GLW ) shares have surged 16% in the past two trading sessions, hitting their highest level since May 2021, after the specialty glass maker boosted its current-quarter outlook due to increasing uptake of its optical connectivity products used in generative artificial intelligence (AI) applications.
Amid the rally, we discuss the technicals on Corning’s weekly chart and identify important levels to watch out for.
Rally Backed by Trading Volume
Since bottoming out at the lower trendline of a descending channel in late October, Corning shares have continued to trend sharply higher, with gains accelerating upon a breakout of the pattern’s upper trendline.
Importantly, the stock’s surge this week has occurred on the largest weekly trading volume since February 2018, indicating strong conviction behind the move.
In addition, the relative strength index (RSI) confirms the bullish price momentum, but also signals significantly overbought conditions with a reading above the 80 threshold.
Multi-Year High in Focus
Corning shares were up 0.7% at $45.00 in premarket trading Wednesday.
Given the stock’s recent move higher, investors should monitor for a potential imminent retest of Corning’s April 2021 high at $46.82.
To project a longer-term general price target , we can use a bars pattern from the pandemic-era low to the April 21 high and apply it to last year’s low. This forecasts a price target around the $60 area.
Monitor These Key Chart Levels Amid Profit Taking
During periods of profit taking, investors should monitor three specific locations on the chart where the shares may attract interest from buyers seeking entry points at lower levels.
An initial pullback could see a move down to around $39 to fill this week’s guidance-inspired gap , with the level also likely to find support from a series of back and forth price action between January 2021 and March 2022.
A move below this level may spark a decline to the key $35 region, an area on the chart that would likely see buying near a horizontal line that links many peaks and troughs between January 2018 and July last year, and also roughly aligns with the 200-day moving average .
Finally, a trendline that connects a range of price points extending back to July 2017 could provide lower support around the $31 level.
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As of the date this article was written, the author does not own any of the above securities.