Where to Buy Palantir Pullback: We're Targeting This Breakout Price
Palantir shares fell after the company reported strong earnings and revenue growth.
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In early trading on Tuesday, shares of Palantir (PLTR) are lower by about 8%. Palantir has been one of the market darlings of 2025, due to the rapid rise of both its share price and the company’s profile.
Should investors be concerned about the sharp drop in Palantir, or is this an opportunity to buy one of the hottest stocks of 2025? Year to date, Palantir shares have gained 175%. Over the past 12 months, the stock has climbed 400%.
Solid Earnings and Revenue
After Monday’s close, the Denver, Colorado-based software analytics provider reported strong earnings and revenue for its third quarter. The company earned 21 cents per share for the quarter, well above the estimate of 17 cents. Revenue of $1.18 billion exceeded analysts’ expectations of $1.09 billion by about 8%.
The company also said it expected strong revenue for its current quarter, and raised its guidance for full-year revenue.
A Strategy for Palantir
What’s our strategy for Palantir? Let’s go to the chart.
Just last week, Palantir broke out of an ascending triangle pattern (black lines). In recent weeks, the stock has found solid support on its 50-day moving average (blue), which roughly coincides with the bottom of the triangle.
An ascending triangle is a bullish pattern, so it comes as no surprise that Palantir shot from that formation to reach new all-time highs.
A Textbook Opportunity
While aggressive traders may choose to go long as the stock breaks out to fresh highs, other traders may wait for the pullback. The advantage in waiting is a potential entry opportunity at a lower price, but only if the stock pulls back to the breakout point (upper horizontal black line). The risk in waiting is that the stock might never pull back to that breakout area.
On Palantir’s chart, that black line appears at about $190. This is a textbook opportunity to buy the pullback in the stock.
Adding a Short-Term Trade
I have no plans to touch my core long position in Palantir, but Tuesday’s pullback provides an opportunity to add a short-term trade.
My game plan is to buy the Palantir pullback near the $190 breakout point. I’ll close the short-term trade (but not the long-term position) if Palantir drops below the 50-day moving average, which has acted as support recently. That moving average is currently located near $175.
I prefer to think of the short-term trade as completely separate from the long-term position. While a further decline could quickly end the short-term trade, it would take a considerably deeper drop to take me out of the long-term trade.
At the time of publication, Ponsi was long PLTR.
