Intel Corp (NASDAQ:INTC) gapped up over 7% higher on Tuesday after the company announced it plans to take Mobileye public in the United States by mid-next year.
- The stock ran into a resistance level when the markets opened at $54.87 and when Intel wasn’t able to regain the level as support with bullish follow-through traders began to take profits, which dropped the stock down about 3% intraday.
- The gap up allowed Intel to partially fill a gap left behind on Oct. 22 when Intel saw a bearish reaction to its earnings print. The lower part of the gap has not been filled, however, and the stock is likely to trade down into the range in the future.
- Now that Intel has created a higher high on the daily chart, it is possible the stock will fill the gap when it prints a higher low in the near future.
- If Intel closes the trading session near its low-of-day price it will print a Marubozu candle on the daily chart, which could indicate the gap-fill and higher low will come on Wednesday or Thursday.
- Intel is extended from the daily eight-day and 21-day exponential moving averages, which also indicates there is a need for consolidation. Traders can also watch for an inside bar pattern to develop on Wednesday.
- The stock has support below at $53.08 and $51.58 and resistance above at $54.87 and $56.23.
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