To The Moon

Micron Is Up 350% Over 12 Months. What Its Chart Says Ahead of Earnings

Memory-chip designer $Micron Technology(MU)$   has gained some 350% over the past year and beaten the $S&P 500(.SPX)$   in basically every timeframe from one month to five years. Let's check out its fundamentals and technicals as it prepares to report earnings this week.

Micron's Fundamental Analysis

MU is set to report the fiscal Q2 results after the closing bell Wednesday, with the Street looking for $8.60 in adjusted earnings per share on $19.1 billion of revenue.

That would represent a 451.2% gain from the $1.56 in adjusted EPS that Micron reported in the year-ago period, as well as more than 137% of sale growth. Those are not typos.

Meanwhile, 23 of the 30 sell-side analysts that I know of who cover MU have revised their earnings estimates higher since the quarter began, while seven have left their numbers unchanged and exactly zero have cut their forecasts.

That's because it's generally believed by analysts that Micron and its memory-focused competitors will all have good quarters. After all, they haven't been able to keep up with demand, and their margins have been on the rise.

Micron's Technical Analysis

Now let's check out MU's chart going back some seven months and running through Wednesday afternoon (March 11):

We will see that MU rallied throughout 2025's second half, with gains accelerating in December and January.

Then MU put in what's known as a bull-flag pattern, marked with a diagonal black line and green box in the chart above. This is a pattern of trend continuance.

That might seem counterintuitive, as MU has struggled since then.

But the stock looks like it's entered a basing period of consolidation, denoted by two downward-sloping black lines at the chart's right. However, MU's bullish trend seems to remain intact.

This pattern's apparent pivot would be Micron's 21-day Exponential Moving Average (or "EMA," denoted by a green line above).

We will also see that Micron's 50-day Simple Moving Average (or "SMA," marked with blue line) has provided support. This implies that professional money managers defended the stock when it tested that line.

As for Micron's other technical indicators, the stock's Relative Strength Index (the gray line at the chart's top) has been rising and is back above a neutral reading.

Similarly, Micron's daily Moving Average Convergence Divergence indicator (or "MACD," denoted by blue bars and a black and gold line) is showing signs of life as well.

For example, the histogram of the 9-day EMA is moving towards the zero bound, although it's not yet postured bullishly.

That said, the 12-day EMA (the black line) and 26-day EMA (the gold line) are also both in positive territory, which is moderately bullish.

Additionally, the 12-day line is making a move upwards toward the 26-day line. Should the 12-day line actually cross above the 26-day one while both are still above zero, that would be a very bullish signal as well.

An Options Option

Some option traders who are bullish on MU based on its technical indicators are likely employing a bull-call spread in this scenario.

This strategy involves buying one call option and selling another with a higher strike price, but with both expiring on the same day. Here's an example:

-- Long one MU call with a March 20 expiration (i.e., after earnings) at a $402.50 strike price. This cost about $26.40 at recent prices.

-- Short one MU March 20 $425 call for roughly $16.30.

Net Debit: $10.10.

This trader would be risking the $10.10 net debit to try to bring back $22.50, for a $12.40 maximum net theoretical profit. This would occur if MU traded at or above $425 at expiration.

Conversely, the above trade's maximum theoretical loss would be $10.10 – the entire net debit. An options investor would face that MU traded at or below $402.50 at expiration.

Disclaimer: The information provided is NOT financial advice. I am not a financial adviser, accountant or the like. This information is purely from my own due diligence and an expression of my thoughts, my opinions based on my personal experiences, and the way I transact.

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