Oracle Suddenly Looks Different: Why This Former Bear Is Taking a Second Look
As a bearish pattern turns bullish, is it Oracle to the moon? Here's what's lighting a fuse under the shares and my game plan.
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A couple of weeks ago, I was a guest on a podcast hosted by Jason Meshnick, TheStreet Pro's CEO. I appeared alongside colleagues Bob Lang and Louis Llanes.
Towards the end of the discussion (watch here), when asked to pick a stock going forward, Louis selected Oracle (ORCL) . I gave him a bit of some good-natured fun at the time as I have long steered clear of that name due to the poor quality of its balance sheet. Well, it turns out now, that after the last couple of days, that Louis' pick may have been spot on.
Let's explore...
News Late Monday
After the close of business on Monday, Bloom Energy (BE) announced a newly expanded partnership with Oracle that would support the rapid buildout of that firm's AI-focused, cloud computing infrastructure.
Under this agreement, Oracle is set to procure up to 2.8 gigawatts fuel cell systems for Bloom. An initial 1.2 GW of capacity has already been contracted, with deployment already underway. This will continue into 2027.
These fuel cells will support Oracle projects across the U.S. and help Oracle meet demand for its AI/cloud infrastructure business. Shares of ORCL traded up almost 5% on Monday and are up almost 5% on Tuesday.
News has also broken recently that Oracle has committed between $14 billion to $16 billion in project and debt financing to build out a large facility in Saline Township, Michigan. This facility will be used to support OpenAI and Microsoft (MSFT) AI-centric workloads.
Yes, the stock is still down quite significantly year to date in 2026 and really since mid-September. Are these "newsy" catalysts enough to turn the stock around? Or is this just a relief rally of some kind that will ultimately fizzle out?
The Chart
This chart displays the downward-sloping trend that had taken ORCL shares dramatically lower since September. The downtrend is illustrated using a Raff Regression model.
As ORCL neared the mid-$130s, support developed as the stock stopped making new lower lows but continued to make lower highs. This created a Descending Triangle pattern of bearish continuance. However, the stock is breaking to the upside from this pattern.
One thing to remember is that some of the strongest and most sustainable rallies are born of bullish breakouts from bearish patterns. Yes, it happens and it often pays to take heed when it does.
Here, Relative Strength has spiked as the daily MACD has suddenly taken on a more bullish posture as well. I think an interested investor/trader could use the 50-day simple moving average (SMA) (roughly $150) as a pivot.
The 200-day line is far off, but this setup makes a price target close to $187 very realistic. I intend to initiate a starter long position in the name once this bull run has rusted out and the stock moves to retest its 50-day line from above.
I do not know that I will be able to take down any equity at or close to $150, but I don't think I have to pay anything in the $160s. I'll wait for a negative war/peace-related headline and get involved.
Related: Is Tesla’s Valuation Ludicrous? Or Is the Company About to Go Plaid?
At the time of publication, Guilfoyle had no positions in any securities mentioned.
