Micron’s relative strength index reaches 90, its highest level in nearly 30 years, raising concerns of a potential pullback.
Micron’s (MU) relative strength index (RSI) has climbed to 90, a level not seen since September 1995, when it last hit 96. The RSI, a key momentum indicator, suggests the stock may be overbought after a rapid price surge, historically preceding corrections or reversals.
The last time Micron’s RSI approached these levels, the stock declined sharply over the following months, continuing its sell-off until mid-1996. Current momentum is driven by surging demand for memory chips, fueled by AI data center expansion and hyperscaler investments from companies like Amazon (AMZN).
Memory chip suppliers, including Micron and Sandisk (SNDK), have capitalized on tight supply conditions, raising prices to boost profitability. Analysts cite robust server demand extending the memory cycle, though technical indicators warn of potential near-term volatility.