MU at $775, would you still dare to touch it?
From 1255 down to 700, everyone said "the AI memory bubble has burst." Just today, a big bullish candle pushed from 700 to 775, up 7%, with trading volume exploding to $1 billion, and Goldman Sachs still has a target price of 1250. Is this a dead cat bounce or the second wave of a super cycle?
Let's look at the surface first: down 40%, but a violent rebound today.
In the past 30 days, it dropped more than 20%, crashing from the high of 1255 to around 700, burying many investors. But just now, it surged from 700.93 to 778 within 24 hours, with volume at the billion-dollar level, funding rates near zero, open interest falling but still active. The candlestick tells you: an oversold rebound has started.
First thing: everyone is focused on "down 40%", no one looks at the P/E which is only 9 times.
Micron's fiscal 2026 Q4 revenue is $54.2 billion, up 379% year-over-year. Gross margin 87%. EPS $33.42. Full-year revenue $133.2 billion. Fiscal 2027 Q1 guidance $61.5 billion ± $1.5 billion, EPS 38.15.
Do the math: current price 775, EPS 33.42, P/E less than 10 times. Forward is even lower.
A company with 87% gross margin, revenue nearly quadrupled year-over-year, and HBM capacity locked through 2027, the market gives it a 9x P/E. You tell me this is a bubble, then what isn't?
The stock price fell from 1255 to 700 not because fundamentals collapsed, but due to midterm election sentiment, data center local resistance, rate hike expectations—all emotions, not performance.
What fell was valuation, not the business.
Second thing: there's a signal hidden in Anthropic's IPO prospectus that 99% of people didn't understand.
Anthropic updated its IPO prospectus, with Micron, Nvidia, Google, and others committing about $26 billion in private placements, with Micron itself around $1 billion.
In plain language: the top AI companies have tied Micron to their war chariot before going public.
This is not "Micron begging to sell chips," it's "Anthropic and others begging to lock capacity." Most HBM 2027 capacity is already locked, long-term supply agreements' RPO has risen to about $150 billion scale—customers are paying upfront to lock supply.
What is a super cycle? It's when you haven't even produced yet, but the money has already arrived.
CoreWeave's earnings eased concerns about AI capital expenditure slowdown, memory chip stocks collectively rebounded. Goldman Sachs maintains a target price near 1250, analysts overall Strong Buy, average target price far above current price.
Third thing: technically this is a "correction," not a "reversal," don't confuse them.
4H/Daily: rapid rise from 650-700 lows, breaking previous high resistance, now at 770-780. RSI recovering from oversold, MACD histogram improving, OI falling with price rising—partly short covering, not purely new longs entering.
Support: 750-760 (recent dense area) → 720-730 (previous low/gap) → 700 psychological level
Resistance: 780-800 → 820-850 (previous rebound highs/moving averages) → 900+
Failing to hold 800-850 is a prelude to a second dip; a volume breakout above 850 confirms trend reversal.
And the next windows are close—Nvidia earnings on November 17, Micron's own mid-December earnings. Don't go all-in before these two bombs are defused.
Bull vs. Bear, you decide:
On one side:
Revenue up 379% YoY, gross margin 87%, P/E under 10
HBM 2027 capacity locked, RPO at $150 billion scale
Anthropic IPO binding, core AI ecosystem supplier
Goldman Sachs target 1250, analysts Strong Buy
Oversold rebound, short covering driving, volume supporting
On the other side:
October CPI above expectations, December FOMC rate hike of 25 or even 50bps discussion heating up
US Treasury yields rising, suppressing high-valuation tech stocks
From 1255 down to 700, midterm downtrend channel not broken yet
OI falling, rebound driven by short covering, insufficient new longs
Nvidia and Micron earnings windows ahead, high volatility
Trading strategy (no nonsense):
Aggressive short-term:
Light long positions near current price or on pullback to 760-770, stop loss below 730-740, first target 790-810, second target 830-850. Add more on volume breakout above 780.
Conservative swing:
Wait for pullback to 720-750 to build long positions in batches, stop loss below 700, target 800+. Combine with Nvidia earnings sentiment. Strong fundamentals, buying dips always better than chasing highs.
Short/hedge:
If hitting 780-800 meets resistance with volume contraction, light short positions with targets at 750/720 pullbacks, stop loss above 820. More suitable when macro rate hike expectations rise.
Wait and see/right side:
Break above 850 and hold to add longs, or break below 700 to confirm weakness before considering shorts.
MU now is like Nvidia at the start of 2023—
99% thought "it’s risen too much, the bubble will burst," but it went from a bit over 100 to over 1000. $BTC$MU$NVDA
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