Micron (MU) surges to the $900 threshold... 'China shock' and CEO's stock sale 'hold it back'

▲ Micron (MU), HBM, Artificial Intelligence (AI), Memory Chip/AI Generated Image

Micron Technology (MU) stock price has rebounded to the threshold of $900. Demand for High Bandwidth Memory (HBM) reignited the flame, but competition from China, insider selling, and technical resistance are holding it back.

According to U.S. economic media FX Leaders on August 4 (local time), Micron's stock price rebounded nearly 8% in recent trading days after falling below $800 in July. The stock tested $900, but analysis suggests that it needs to overcome several resistance levels to confirm a recovery in its mid-to-long-term upward trend.

The key driver of the rebound is the demand for HBM used in AI accelerators. The earnings of major tech companies showed continued investment in cloud and enterprise AI infrastructure. In the DRAM and NAND markets, supply reduction due to production adjustments supported improvements in average selling prices and profitability. However, demand for personal computers and smartphones was weaker than for data centers.

A large-scale stock sale by Micron CEO Sanjay Mehrotra pressured investor sentiment. Mehrotra sold over 40,000 shares for approximately $37.3 million on July 24. The transaction was conducted under a pre-established U.S. Securities and Exchange Commission Rule 10b5-1 plan, and there was no evidence suggesting it was related to material non-public information.

The pursuit by the Chinese memory industry is also a variable. ChangXin Memory Technologies (CXMT) is expanding its DRAM production capacity, reducing reliance on foreign semiconductors. If Chinese companies' technology and production volume increase simultaneously, global memory supply could grow faster than demand, putting pressure on prices and profit margins. The spread of highly efficient AI models could also slow the long-term growth rate of hardware demand.

Technically, the area around $900, where the 20-day simple moving average is located, is the first hurdle. The stock previously faced resistance in the area above $1,000 before falling to the $800 range. FX Leaders analyzed that a sustained buying spree must break through the resistance area above $900 to conclude that the July correction has ended and the upward trend has been restored.

[Article Key Summary]

-Micron's stock price rebounded nearly 8% after falling below $800 in July, testing $900.

-HBM demand and improved memory prices supported the stock, but concerns about Chinese competition and slowing AI investment remain.

-The recovery of the mid-to-long-term upward trend can only be confirmed by breaking above the 20-day simple moving average around $900.

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