Intel's 18A chip plan shelved, stock price falls below key technical level

[Coin World] Intel ( INTC ) Stock Update – Negative 18A news leads to bearish collapse

Intel's stock fell 4.25% yesterday to $21.88 due to a key statement: the company may stop marketing its advanced 18A chip manufacturing process due to low customer interest and instead focus on its 14A technology. Despite the broader semiconductor industry performing strongly, this decline occurred—it's noteworthy that the SMH ETF rose nearly 2% on the same day. This divergence indicates a clear relative weakness, which is a key factor for short-term and swing traders.

Key technical developments on the INTC price chart (4-hour time frame)

Breaks below the value area high point (VAH): The value area high point (marked as 6) of the horizontal range starting after the 2024 August earnings is $22.86. INTC closed well below this level, nearly $1 lower, confirming the failure of the breakout and returning to the value area.

Failed to break above the red resistance line: We previously pointed out that two consecutive 4-hour candles closing below the red resistance line would invalidate the bullish scenario. This situation has now occurred, although the magnitude of the first candle was quite small. Nevertheless, the technical damage is evident.

Support level failed to hold: The price has fallen below the VAH (Value Area High) of the consolidation zone, broken the red resistance line, and even fallen below the midpoint of the purple channel. The bears have regained control, and as long as the price remains below 22.50 dollars, the bears will maintain control.

The next level to pay attention to

Short-term support level: the bottom track of the ascending purple channel. Mid-term target: Control point (POC), priced at 20.20 USD—a fair value area with a significant historical trading volume. Long-term buying zone: approximately 19.17 dollars, which is the lower value area of the larger consolidation range (blue line).

Strategy recommendations for INTC stock

If you hold a position: Even if the stop-loss level has not technically been breached, conservative traders may wish to exit now. Hesitating to exit? Consider selling half to reduce risk exposure. This is a classic method of managing uncertainty while maintaining upside potential, in case the bulls unexpectedly regain control.

This case illustrates that merely news (such as yesterday's seemingly important news from Intel) cannot determine direction. Price action determines direction. Bad news accompanied by poor stock price reaction means bad. Good news accompanied by good price reaction means good. A lack of price reaction to good news, or a lack of price reaction to bad news—usually, both indicate that the news is not important. In any case, Intel's failure to maintain key breakout levels, especially in the context of peers rising, is more telling than the news itself.

Investing and/or trading INTC stocks is at your own risk.