ARM Holdings share is approaching a technical resistance and could return to a bearish configuration.

The security seems overvalued: the valuation of the group in terms of multiples of earnings appear relatively high. Currently, share price is 50.5 times its expected earnings per share for the current year. Moreover, analysts have recently downgraded their EPS estimates.

Technically, the neutral trend dominates in the medium and the short term. Indicators highlighted an overbought situation in recent sessions. This indicator shows a limited potential for a possible recovery due to the midterm resistance at GBp 963.

Due to the technical configuration and a fragile fundamental situation that does not justify the current valuation of the group, investors can open a short position on the stock close to the GBp 963 resistance. The price target is set at GBp 915.5 and a stop loss will be placed above GBp 963.