Is Micron Ready to Rally?

NEW YORK ( TheStreet) -- The semiconductor space was very strong Wednesday, with Broadcom (BRCM) leading the way. BRCM surged over 20% on extremely heavy trade as talks of a merger with Avago surfaced.

This powerful move was felt throughout the entire sector. Micron Technology  (MU), which makes up 5% of the Market Vectors Semiconductor ETF (SMH), gained just shy of 3%. Unlike BRCM, Micron has been trading near its lows of the year for the last eight weeks. With yesterday's healthy advance, MU appears ready to leave behind a significant bottom and return to rally mode.

In late March, MU retested the major spike low the stock left behind back on Oct. 15. The stock quickly recovered but was unable to maintain the rally. Late April brought another dip that pushed the stock back down to the lows. Heading into this week, shares had rebounded slightly from the solid support just below $26. Wednesday this recovery got a nice boost on accelerating trade and closed with almost a 3% gain.

The next challenge for Micron will be its April high of $29.80. If volume flows continue to improve, the stock may power right past this level as it leaves behind what could soon develop into a major bottom at its March/April/May lows.

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At the time of publication, Morrow was long MU.

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