Qualcomm shares dip amid rising selling pressure

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Qualcomm slides 8.20% today

Highlights

Qualcomm secured a major AI chip supply deal with ByteDance, expanding its high-volume AI customer base significantly.
Automotive revenues surpassed $5 billion annually thanks to deeper partnerships like the expanded Stellantis agreement, while the company announced a $20 billion share repurchase.
Despite fundamental gains, the stock faces heavy selling after an 8.2% drop, but technicals indicate a bullish structure with an expected range of $205.04 to $262.74 over the next week.

Contract wins and buyback fail to offset broad selling pressure

Qualcomm recently secured a major contract to supply millions of AI chips to ByteDance, the owner of TikTok, with the agreement expected to make ByteDance one of the company's first significant high-volume customers for AI-specific circuits. The company also expanded its relationship with Stellantis, as its Snapdragon Digital Chassis helped drive automotive revenues to over $5 billion annually. In addition, Qualcomm announced a $20 billion share repurchase program and maintained its ongoing dividend, though price action has remained under broader selling pressure.

Anton Kharitonov, expert at Traders Union, sees Qualcomm's technical uptrend as fragile following the stark 8.20% drop. He notes that while momentum and moving averages remain bullish, the overbought signals across multiple indicators raise red flags. Kharitonov underscores concerns about elevated volatility and the risk of a deeper correction despite recent positive corporate developments. He warns about dependence on a few large contracts, such as ByteDance and Stellantis, which may not offset broader selling pressure. "Aggressive buyers should be cautious — technical strength is at risk if $205.04 breaks, and overbought conditions could accelerate downside," he states.

Viktoras Karapetjanc, expert at Traders Union, remains confident about Qualcomm’s outlook. He highlights the strong pipeline with ByteDance and Stellantis as proof of growing demand for its AI and automotive platforms. Forward indicators support further gains, with the bullish technical arrangement boosting investor sentiment. Karapetjanc sees the $20 billion buyback and ongoing dividend as underlining management’s conviction in future growth. "The market’s bullish structure remains intact — further upside is likely if Qualcomm consolidates above $228.12," he says.

Overbought signals emerge as bullish momentum meets technical resistance

Qualcomm is trading above its 20-day, 50-day, and 200-day moving averages ($199.91, $159.00, and $161.08, respectively), signaling a bullish structure in both the short and long term. Dynamic support sits near the Ichimoku Kijun level at $194.45, with resistance likely found at the psychologically significant $250 region.

Momentum indicators show divergence across timeframes. MACD and Average Directional Index (ADX) both point to continued upward momentum, yet the Relative Strength Index (RSI) signals overbought conditions near 74.01, a view confirmed by overbought readings from both Commodity Channel Index (CCI) and Bull/Bear Power (BBP). BBP indicates buyers have recently dominated, but with an overbought signal now present. Awesome Oscillator (AO) is supportive of bullish momentum on the daily timeframe. The stock fell sharply today, dropping 8.20% to $228.12 following a pronounced downside gap of about $4.27 at the open. Price action is now near the session’s low, with intraday volatility at an elevated 10.29%. Trading has shown strong selling pressure after the open, aligning with the short-term loss of momentum and overbought signals.

Earlier, analysts noted that Qualcomm’s strong operational momentum in AI and automotive sectors was creating a bullish technical profile, even as volatility increased following major partnership announcements. The latest confirmation of bullish alignment across key weekly indicators reinforces this outlook, making the $262.74 resistance level a critical threshold for potential breakout-driven gains in the days ahead.

Source of Data: QCOM Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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