Yahoo Finance

Key Takeaways

• CoreWeave shares soared last week after the AI cloud provider posted a surge in quarterly revenue and disclosed that Nvidia has a higher stake in the company than investors had anticipated.

• The stock forged a cup and handle pattern on the chart between late April and early May before breaking out above the formation’s top trendline last week.

• The measuring principle projects an upside target in the shares of $96.90, about 20% above Friday's closing price.

• Investors should watch key support levels on CoreWeave's chart around $73 and $57.

CoreWeave (CRWV) shares soared last week after the AI cloud provider posted a surge in quarterly revenue and disclosed that Nvidia (NVDA) has a higher stake in the company than investors had anticipated.

CoreWeave, which went public in late March, reported Wednesday that first-quarter revenue grew over 400% year-over-year and said via a regulatory filing on Thursday that major partner Nvidia holds a 7% stake in the company, up from its pre-initial public offering holdings of roughly 5%.

The company also said last week that it had agreed to a four-year deal with ChatGPT maker OpenAI worth up to $4 billion, adding to a nearly $12 billion commitment announced in March.

CoreWeave shares have more than doubled from their $40 IPO price, boosted by last week’s news and investor appetite for up-and-coming generative AI plays that are scaling to meet the technology’s widespread demand. The stock gained 56% last week alone, closing Friday's session at $80.30.

Below, we break down the technicals on CoreWeave’s hourly chart and point out key price levels that investors will likely be watching out for.

Cup and Handle Breakout

CoreWeave shares forged a cup and handle pattern on the chart between late April and early May before breaking out above the formation’s top trendline last week.

Importantly, the move higher has occurred on above-average trading volume, indicating conviction from larger market participants behind the buying. Moreover, the relative strength index confirms bullish price momentum with an elevated reading, though the indicator fell below the overbought threshold on Friday, suggesting minor profit-taking ahead of the weekend.

Let’s apply technical analysis to identify a potential upside price target to watch if CoreWeave shares continue to rally and also identify several key support levels worth monitoring during pullbacks.

Chart-Based Upside Price Target

Investors can project a potential upside price target by using the measuring principle, a technique that analyzes prior price action to forecast future moves.