Dell Technologies (DELL) saw its stock plunge in after-hours trading on Tuesday, following the release of its third-quarter fiscal 2025 earnings, which came in below analysts’ forecasts. The company’s revenue for the quarter did not meet Wall Street’s expectations, and its revenue guidance for the upcoming January quarter also fell short of analysts’ estimates. Dell projected a revenue range between $24 billion and $25 billion, missing the anticipated $25.6 billion.
Despite recording a surge in artificial intelligence (AI) server orders during the quarter, Dell expressed concerns about weak demand in its traditional personal computer and storage segments, which could dampen investor sentiment moving forward. As a result, Dell’s stock dropped by 11% to $125.75 in extended trading. However, the stock had been a strong performer throughout the year, gaining 85% year-to-date, vastly outperforming the broader S&P 500, which has risen 26% during the same period.
Investors are now closely monitoring the stock’s technical outlook. Here’s a deeper look at Dell’s chart and the key levels that could guide its next move.
After falling below its 200-day moving average (MA) in early August, Dell’s stock had been steadily climbing within a rising wedge pattern. This technical formation often signals a potential reversal if the price breaks below the lower trendline. While the Relative Strength Index (RSI) had shown positive momentum, the indicator began to dip ahead of the earnings release, as the stock faced selling pressure near the upper boundary of the wedge.
$130 Support: The first significant level of support to watch is around $130, where the stock could find buying interest. This level aligns with a trendline that connects several peaks and troughs from March to November, and it may coincide with the rising 50-day moving average.
$105 Support: If Dell breaks below $130, the next key support zone is around $105, which corresponds with the March swing low and a cluster of price levels just above the early-September trough. A move to this area could prompt further selling pressure.
$87 Support: In the event of a more significant downturn, the $87 level represents a final support point, near the early August swing low and February’s twin peaks. This could offer a potential buying opportunity for long-term investors looking for a favorable entry.
On the upside, if Dell resumes its longer-term uptrend, the $180 price level will be an important area to monitor. This marks the stock’s all-time high (ATH), and investors who purchased shares at lower prices may look to lock in profits as the stock approaches this level.
In summary, while Dell’s recent earnings disappointment has sparked a decline in its stock price, the company’s strong performance in AI servers and its robust year-to-date gain keep it on the radar of investors. Moving forward, the key technical levels will be crucial in determining the stock’s next direction.
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