DELL has pulled back to a historically bullish trendline
Dell Technologies Inc (NYSE:DELL) stock suffered a sharp post-earnings drop at the end of May, after the company warned of margin pressure due to artificial intelligence (AI) investments, losing 17.9% for its worst daily percentage loss since December 2018. DELL was trading at record highs before the gap lower, however, and is still up 76.2% since the start of the year.
Now could be a good time to buy the stock on the dip, as it has yet to break above its post-earnings close, though it was last seen up 2.8% at $135.70 at last check today. DELL is also seeing support from the 50-day moving average, which has preceded bullish activity in the past.
Per Schaeffer's Senior Quantitative Analyst Rocky White, the security has come within one standard deviation of its 50-day trendline six times in the past three years, defined for this study as having traded north of this trendline 80% of the time during the past two months, and in eight of the past 10 trading days. One month later, the stock was higher 83% of the time after these signals, averaging an impressive 13.2% return. A similar move would push the stock above $153.
