Snowflake loses momentum as AI capital shifts to chipmakers
Snowflake is gradually losing momentum after its strong rally in late May. While the company's long-term fundamentals remain solid, capital continues to rotate toward AI chipmakers, which currently offer investors higher growth potential.
Following its strong quarterly earnings report, Snowflake received a significant boost. However, the company has seen few meaningful corporate catalysts in recent days. At the same time, investor attention has shifted toward the semiconductor sector after Micron's outstanding earnings confirmed rapidly growing demand for AI infrastructure.
As a result, some capital is flowing out of enterprise software companies and into chip and memory manufacturers, which are direct beneficiaries of the current AI investment cycle. While this does not weaken Snowflake's long-term fundamentals, it has temporarily reduced investor interest in the stock.
Snowflake loses key support
The previously expected support at $230 failed to hold, and the stock has now established itself below that level.
The next key support lies near $215. If that level is also breached, the probability of a medium-term decline toward the 200-day simple moving average (SMA) around $206 will increase significantly.
To resume its medium-term uptrend, SNOW needs to reclaim the $230–236 range.
Until then, the stock is likely to remain under selling pressure ahead of its next quarterly earnings report, scheduled for August 26.
Snowflake awaits its next growth catalyst
Snowflake's long-term investment story remains intact. The company continues to benefit from rising enterprise AI spending, expands its partnership ecosystem, and develops its own AI-powered solutions.
However, the market is becoming increasingly selective. To regain sustainable upward momentum, Snowflake will likely need either a new major corporate catalyst or further evidence that its business growth is accelerating.
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