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TradingKey - On November 4, Seagate Technology (STX) shares extended their recent correction, closing down 8.13% at $557.06 on volume of approximately 6.7 million shares. Compared with its nearly two-month high of $946.36 in October, STX has posted a cumulative drop of nearly 40%. On the same day, Micron fell 7%, and storage stocks such as Western Digital and SanDisk also weakened noticeably, leaving the sector as a whole still in a correction phase.

Recent sentiment in the storage sector has been weighed down by several industry developments. In late October, although Samsung Electronics reported strong chip profits, its earnings and shareholder return plan failed to further exceed elevated market expectations, leading to a notable post-earnings decline in its stock price. Subsequently, Kioxia issued a quarterly outlook below market forecasts, once again dragging down shares of Micron, Western Digital, and SanDisk. These events have intensified market scrutiny over whether the sector's previous high-growth boom can be sustained.

Meanwhile, the sustainability of AI infrastructure investment has also emerged as a key sentiment driver affecting storage stocks. According to Bloomberg, although financial results from multiple storage manufacturers remain strong, investors have begun reassessing whether Big Tech's AI capital expenditure can be sustained over the long term. On November 4, semiconductor stocks such as Micron and SanDisk tumbled again, while the market was also concerned that stricter scrutiny on data center construction could emerge after the U.S. midterm elections, creating additional pressure on storage, chip, and other AI infrastructure providers.

Seagate daily stock chart, Source: TradingView

From the daily chart of Seagate's stock price, as the stock fell below its 144-day moving average and broke below key platform support at $700, bearish market momentum has strengthened significantly. This also signifies that the stock's medium- to long-term bullish trend has been broken, and it is set to enter an extended correction phase.

Meanwhile, after recently breaking below key platform support at $700, the stock saw two consecutive rebound attempts capped by this level, leading to renewed weakness. The candlestick structure has visibly deteriorated, further reinforcing bearish market momentum.

Looking ahead, the stock may continue to fall in the near term. The primary downside target to watch is support in the $475-$450 range. If the stock falls below $450, it could test further down toward around $340, representing a decline of more than 30% from the current price.

On the upside, the primary resistance level to watch is the $600 mark. If it breaks upward through this level, the next resistance level to watch is near $636, with key resistance further above at $700.

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