Is $AEHR ready to go? – March 16, 2023


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This is Scott with your Chart of the Day. I want to talk about Aehr Test Systems ( NASDAQ: AEHR ). Now, Aehr ( NASDAQ: AEHR ) isn’t really a household name, it is not like AMD ( NASDAQ: AMD ), or NVIDIA ( NASDAQ: NVDA ), or something like that, but this stock has been strong for a while.

If I zoom out here you can see how it has had a pretty nice uptrend since July of last year. From July of last year to now, almost a 350 percent run, and I think it still has room to move. The reason I think that is because it is set up in a really nice consolidation pattern. You can see this great drift back down to the 50-day moving average.

Dan Fitzpatrick at often warns people about buying pullbacks that are really steep, those quick flash pullbacks. He says those are a little risky. But this one basically drifted back down to the 50-day moving average over the past month and a half or so. When it got back to the 50-day the buyers started to come in again. And they solidified it so it closed back above all the major moving averages.

Now, the only real thing I have to nitpick about this chart is the fact that if I bring in the volume, the volume was lower than average, it wasn’t great volume. Now that said, the stock doesn’t really trade that much, it only has 24 million shares in the float right now. And so you are not going to get those big volume spikes unless something major has happened. You can see that that happened back here, this is probably an earnings run or whatever.

Now, this stock does have earnings coming up on March 30th, but it may have some room to go until then. And as I said, we have this nice downward-sloping trendline, clear resistance, and clear support right here. I want to see if this has the juice to continue higher. Or does this kind of chop around the 50-day moving average a little longer? If it does, that could give you a low-risk entry, with a stop right around that 29.40 area.

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