Marvell (MRVL) collapsed on AI fears... but buyers returned in just one day

▲ Marvell (MRVL)/AI generated image

Marvell Technology (MRVL) rebounded just one day after a 7.32% plunge due to concerns about slowing AI development, but whether it can recover its short-term trend line has emerged as a key variable determining the stock's direction.

According to Benzinga on September 15 (local time), Marvell rebounded over 1% in pre-market trading on Tuesday after plunging 7.32% on Monday. The previous day's sell-off was triggered by executives from major AI companies like Anthropic and OpenAI arguing for a slowdown in advanced AI development due to safety concerns. Fears spread in the market that a slowdown in AI development could dampen demand for semiconductors and data center hardware.

No specific positive news for Marvell itself was identified as the driver behind Tuesday's rebound. Benzinga analyzed that investors returned to AI and data center semiconductor stocks, leading to a partial reversal of the previous day's sharp decline. At the same time, Nasdaq futures fell 0.07% and S&P 500 futures fell 0.04%, indicating that Marvell's rebound was not aligned with a broader market rally.

Technically, the long-term trend is still intact. Marvell is trading approximately 42% above its 200-day simple moving average of $155.49, and also above its 50-day simple moving average of $216.32 and 100-day simple moving average of $219.97. However, it is about 3% below its 20-day simple moving average of $227.59, suggesting a sideways movement rather than a clear breakout in the short term. The Relative Strength Index (RSI) remained in the neutral zone at 47.86.

Key price levels were identified as resistance at $254.50 and support at $200.50. The 50-day simple moving average being above the 200-day simple moving average indicated a positive long-term trend. Wall Street's outlook is also generally bullish. Marvell's average price target is $295.25, with Piper Sandler issuing an "Overweight" rating and a $270 price target. Craig-Hallum maintained a "Buy" rating and raised its price target to $300, while B. Riley Securities maintained a "Buy" rating but lowered its price target to $315.

In Benzinga Edge's evaluation, Marvell scored 99.56 for growth and 98.7 for momentum, but only 2.27 for value. This assessment suggests strong growth and stock resilience, but also that a high stock price could increase downside risk in a deteriorating investment sentiment environment. Marvell constitutes 6.92% of the First Trust Nasdaq Semiconductor ETF (FTXL), 5.69% of the State Street SPDR NYSE Technology ETF (XNTK), and 4.53% of the Invesco PHLX Semiconductor ETF (SOXQ).

[Key Article Summary]

-Marvell rebounded over 1% in pre-market trading on Tuesday after a 7.32% plunge due to concerns about slowing AI development.

-The stock is above its 50-day, 100-day, and 200-day simple moving averages, but below its 20-day line of $227.59, making the recovery of its short-term trend a critical factor.

-Wall Street's average price target is $295.25, and while growth and momentum scores are high, the value score was only 2.27.

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