Super Micro Computer Inc. (SMCI) just did something that makes chart watchers nervous: it formed a Death Cross. That's when the 50-day moving average crosses below the 200-day, and it's basically the market's way of saying "the trend is not your friend." Even Ken Griffin is feeling this one.
For a company that was riding high alongside AI hardware winners not too long ago, this is an uncomfortable turn of events. The stock that everyone wanted to own in the AI boom is now sending signals that technicians take seriously.
The Chart Tells an Uncomfortable Story
SMCI is currently trading around $31.38, which puts it well below every important moving average you'd care about. The eight-day and 20-day averages are hanging out in the low $33 range, while the 50-day and 200-day averages sit near $42. That's a long way down from the 52-week high of $66.44.
The momentum indicators aren't doing the bulls any favors either. The MACD is deeply negative, suggesting downside pressure is actually accelerating rather than easing up. Meanwhile, the RSI is hovering near 32, which puts it in "approaching oversold" territory. That combination usually signals stress, not stability, especially when any attempted rallies fail to break back above those broken averages.
The numbers back up what the chart is screaming. Super Micro is down roughly 28% over the past six months and nearly 8% in just the past month. This is happening while AI-related stocks elsewhere continue pulling in capital, which makes the divergence even more notable.
When Smart Money Gets Caught
Here's where it gets interesting. Citadel Advisors didn't just dip a toe into SMCI. As of the end of Q3, Griffin's firm disclosed a massive position increase of over 750%, bringing total ownership to approximately 4.24 million shares.
The catch? That position carried an average buy price near $48.86. With the stock now trading in the low $30s, Citadel is sitting on a substantial paper loss. It's a useful reminder that even when institutional investors with armies of analysts make big bets, market momentum doesn't care about your conviction.
What Happens Next
Death Crosses don't guarantee the stock keeps falling, but they do change how people behave. For Super Micro, the signal shifts the conversation from "buy the dip" to "manage the damage." Until the stock can climb back above those key moving averages and hold there, any bounce risks being treated as an opportunity to exit rather than a fresh chance to buy.
With momentum clearly broken and major holders nursing losses, the next chapter for SMCI won't be written by hype or AI narratives. It'll be determined by whether the chart can find stability before sellers decide to take full control. Right now, that's still an open question.