Core Scientific (CORZ): A Contrarian Play in an Overbought Market

Core Scientific (NASDAQ: CORZ), a crypto mining and data infrastructure firm, has been a rollercoaster ride for investors in recent months. Despite showing overbought technical signals in early April 2025, its long-term undervaluation, strategic pivots, and underlying fundamentals position it as a compelling contrarian buy. Let’s unpack why this NASDAQ-listed stock is worth considering now—despite the noise.

Technical Analysis: Overbought Now, But Undervalued Over Time

The immediate technical picture for CORZ paints a mixed but intriguing scenario. As of April 29, 2025, the 14-day RSI stood at 63.76, squarely in neutral territory. However, momentum indicators like the Stochastic Oscillator (84.69) and Williams %R (-2.31) were firmly in overbought zones. This suggests near-term profit-taking pressure, potentially creating a buying opportunity once the dust settles.

The MACD (-0.37) and bearish moving averages (e.g., the 50-day SMA at $8.70 vs. April 29’s close of $8.29) add to the bearish signals. Yet, the 200-day SMA at $11.79 highlights how far the stock has fallen from its 2023 highs. This creates a compelling asymmetry: the downside risk is capped by its recent lows, while the long-term upside remains open if the company executes its strategic shifts.

Fundamental Strengths: A Crypto-Backed Pivot

While technicals are neutral-to-bearish in the short term, Core Scientific’s fundamentals are quietly improving. Key positives include:
1. Bitcoin Mining Growth: The company mined 247 Bitcoin in March 2025, a 15% increase from February, demonstrating operational efficiency.
2. Strategic Diversification: Its pivot into high-performance computing (HPC) and cloud infrastructure—driven by partnerships like Clear Street’s $20 price target—adds resilience to crypto volatility.
3. Valuation Discount: At $8.29 per share, CORZ trades at a 28% discount to its 200-day SMA, despite its 38.22% projected gain to $11.46 by 2030.

Why Now? The Contrarian Edge

The market’s short-term overboughtness and bearish sentiment create a perfect storm for contrarians. Here’s why to consider buying:
- Sentiment Overreaction: Of 24 technical indicators, 15 signaled negative trends, yet fundamentals like mining growth and HPC expansion remain intact. This divergence suggests overreaction to noise.
- Volatility as an Ally: The stock’s ±8.47% daily volatility (April 2025 average) means sharp dips could present entry points. A stop-loss at $8.02 (3.21% below April’s close) offers risk management.
- Long-Term Catalysts: Upcoming Q1 2025 earnings (May 7) and the potential for Bitcoin price stability could reset sentiment.

The Risks: Bearish Pressures Remain

No investment is without risk. Core Scientific faces challenges like:
- Margin Pressures: Its EBIT margin of -257.1% underscores operational inefficiencies needing resolution.
- Crypto Volatility: Bitcoin’s price swings directly impact revenue, and its recent dip to $50k could strain margins further.

Conclusion: A Patient Investor’s Play

Core Scientific (CORZ) is a Hold/Accumulate pick for investors willing to look beyond short-term technical noise. While overbought momentum indicators and bearish moving averages suggest near-term volatility, the stock’s undervaluation relative to its 200-day SMA, growing Bitcoin output, and strategic pivots into HPC make it a compelling contrarian bet.

Crunching the numbers:
- Short-Term: A dip to the $8.08 5-day forecast (a -0.02% change) could create a buying floor.
- Long-Term: The $11.46 2030 price target implies a 38.22% gain from April’s close—if Core Scientific executes its diversification strategy.

In a market obsessed with momentum, Core Scientific offers a rare blend of value, growth potential, and catalyst-driven upside. For investors with a 12–18-month horizon, now is the time to consider a position—before the market catches up.