Seagate Technology PLC (STX) - June 13, 2025
Shares of Seagate Technologies PLC (STX) has been moving
quickly up the relative strength matrix in the SIA S&P 500 Index Report and
currently holds position #14. A review of the point and figure chart for STX
shows a recent quadruple top breakout as the share price advanced to $112.34,
with current trading near $126.07. Based on point and figure vertical counts
using two different poles, new resistance might appear near the psychological
level of $200. A closer look at the SIA chart could suggest resistance targets
at $201.75 and $211.83, depending on which pole is referenced.
Support, on the other hand, might begin at the 3-box
reversal level near $106.99. Additional support could be seen around $88.02,
followed by a broader zone between $72.42 and $68.97. Seagate is part of the
SIA Computer Hardware sector, which has improved by 13 positions over the past
month and currently stands as the top gaining sector in the SIA rankings. The
SIA SMAX score, which offers a short-term measure of relative strength compared
to a group of alternative asset classes, gives a perfect score of 10 out of 10.
A review of a monthly candlestick chart, where each bar
reflects one month of trading, shows a strong breakout over the past three
months. Buyers appear to be in control of the supply and demand relationship.
While the strength of the move is notable, a Bollinger Bands overlay reveals
that the share price is currently extended beyond two standard deviations, also
known as two sigmas. Historical examples marked by arrows on the chart suggest
that similar extensions in the past were followed by a reversion to the mean
after periods of rapid price movement.
Bollinger Bands, developed by John Bollinger, serve as a
technical tool to assess overbought or oversold conditions and to measure price
volatility. The bands consist of a middle line, typically a 20-day simple
moving average, with upper and lower bands set two standard deviations above
and below the average. Statistically, about 95% of price action occurs within
these bands. A move beyond either band could indicate an unusual event and
might suggest a pending reversal toward the average. However, in strong trends,
the price might continue to "ride the band," meaning it stays near
the upper or lower boundary for extended periods. This behavior could signal
trend strength rather than an imminent reversal.
In terms of technology, Seagate's HAMR (Heat-Assisted
Magnetic Recording) provides a significant advantage by allowing much higher
data densities than traditional hard drives. This innovation supports drives
with 20TB and beyond, which could be essential for data centers and video
surveillance systems that require reliable and cost-efficient storage
solutions. HAMR-based drives might offer more capacity without increasing power
usage or physical space, making them well-suited for managing large volumes of
video, backups, and analytics data at scale.
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