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Mellanox Technologies (
MLNX) produces and supplies semiconductor interconnect products that facilitate efficient data transmission between servers, storage systems and communications infrastructure equipment and other embedded systems. This stock closed up 1.4% at $47.80 on Wednesday.
Wednesday's Volume: 1.66 million
Average Volume: 714,189
Volume % Change: 171%
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From a technical perspective, MLNX bounced notably higher here right above some near-term support at $45.47 with above-average volume. This stock has been downtrending badly for the last month, with shares falling from its high of $58.98 to its recent low of $45.47. During that move, shares of MLNX have been mostly making lower highs and lower lows, which is bearish technical price action.
That said, shares of MLNX have now moved into oversold levels since its current relative strength index reading is 34. Oversold can always get more oversold, but it's also an area where a stock can experience a powerful bounce higher from.
Traders should now look for long-biased trades in MLNX as long as it's trending above some key near-term support levels at $46 or $45.47 and then once it sustains a move or close above Wednesday's high of $50.98 to some more near-term resistance at $52 with volume that hits near or above 714,189 shares. If we get that move soon, then MLNX will set up to re-test or possibly take out its next major overhead resistance levels at its 50-day moving average of $54.73 to $56.39. Any high-volume move above those levels will then put its next major overhead resistance level at $59 into range for shares of MLNX.