Full Technical Analysis of Wolfspeed, Inc. (WOLF) – 2025-06-20

Step 1: Trend and Market Structure Analysis

• Long-Term Look: Reviewing daily candles, WOLF experienced a catastrophic collapse from ~$5 to a low below $1 between May and June. This was preceded by failed attempts at support around $2–$3 and heavy volume spikes on breakdown, suggesting forced selling or a major fundamental event.
• Recent Action: In the last three weeks, the price struggled to hold above $1, repeatedly failing at resistance zones (notably $1.35, $1.50, $1.70). Volatility has been exceptionally high, but the reaction to these rallies was swift and aggressively sold.
• Current State: The most recent daily candle closed at $0.9001, just above the intraday low and following a protracted evening of failed bounce attempts — the intraday high failed to even test Wednesday’s panic low of $0.87. The lowest close for this down cycle.

Step 2: Volume Analysis

• Climax Selling: The volume profile shows enormous spikes on major down days, especially 5/21 (255M+ shares) and 3/28 (176M+ shares). This is institutional selling, not retail, with many consecutive high-volume red bars following — little evidence that strong hands are accumulating.
• Low-Volume Bounces: All bounces since $1.20 have occurred on declining or light volume and failed to reclaim significant moving averages, showing a lack of genuine buying support.

Step 3: Key Technical Levels

• Support:
  • Immediate: $0.87–0.90 is the last defended area, now tested again.
  • Historical: Below $0.87, there is little to no visible support — this is uncharted territory for WOLF.
• Resistance:
  • Nearest: $0.91/0.92 (intraday highs), followed by $0.95, and major resistance at $1.00 and $1.10.
  • Psychological: $1.00—the failure to hold this round number is extremely bearish.

Step 4: Technical Indicators

• Moving Averages (Estimated):
  • Short-Term: 5/10 EMA would sit above $1.15–$1.20, both sharply declining. Price is drastically below all major MAs, a sign of severe, long-term downtrend.
• RSI: Oversold conditions were likely triggered in late May but have not produced meaningful, sustained bounces. Momentum remains negative.
• MACD: Deeply negative, no crossover signal in sight; bearish momentum persists.
• ATR (Average True Range): Remains high, indicating severe volatility and ongoing risk.

Step 5: Candlestick Patterns, Microstructure, and Orderflow

• Recent Candlestick Patterns: Repeated formation of lower highs, lower lows, and closing on or near session lows with weak, failed wicks — all extremely bearish.
• Intraday Microstructure: Brief bounces met by immediate overwhelming supply. No evidence of a tradable bullish reversal (no indecision candles, no bullish engulfing, no hammer).
• Orderflow: Huge share exchanges at low levels likely indicate capitulating holders or forced liquidations; still, no sign of true absorption by strategic buyers.

Step 6: Pattern Recognition and Advanced Techniques

• Volume/Supply Gaps: After the breakdown below $5, there are obvious supply gaps, especially sub-$3. The most recent gap downs (May 21, June 18) have not been closed (i.e., price never bounced back to retest gap origin), confirming severe overhead supply.
• No Base or Accumulation: No base pattern is evident at these low levels; price action is chop-lower with no consolidation. Classic bottoming patterns (e.g., double bottom, rounding, cup-with-handle) are absent.
• VWAP: The anchored VWAP from May collapse would hover near $1.80—with today’s close around $0.90, this is a sign of catastrophic underperformance.
• Fibonacci Extensions: Projecting from both the recent high ($1.51, June 10) and previous support break, the 161.8% extension lands in the $0.80–$0.85 area. A break below $0.87 can accelerate decline toward these lower fib levels.

Step 7: Sentiment, Volatility Filtering, and General Conditions

• Sentiment: Consistently negative. No news indications (from chart) of rescue, buyout, or bullish catalyst. Massive overhang of bagholders at every price up to $4.
• Volatility: Still extreme, but extreme volatility in downtrends often implies continued downside and ongoing distribution, not reversal or short squeeze.
• Seasonality & Exogenous Drivers: None observed; all factors endogenous and price-driven.

Step 8: Synthesis and Prediction

• Outlook (Next 24 hours):
  • Trend, momentum, and orderflow all point sharply lower. Recent rallies were met with fast rejection.
  • Price is at new lows, and no evidence suggests a short-term bounce is brewing. Buyers are absent; those who bought dips have been quickly trapped and underwater.
  • Risk is high, but the path of least resistance is lower. Institutional tranches and algorithms likely see this as a persistent downtrend and will continue to pressure the price.
  • The only nearby support is $0.87, and a break below it can trigger stop-loss orders and margin calls, hastening a further collapse toward $0.80–$0.85.

Conclusion: The technicals overwhelmingly favor a SELL (Short Position). This is not an area to try catching the bottom. Price action, microstructure, and multi-timeframe signals all align for further downside.

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