LDOS Just Ripped 45%. It Still Might Be Cheap.Leidos Holdings, Inc.BATS:LDOSAltitudeAlpha I have been excited about LDOS since its recent breakout started earlier this month. Leidos has moved nearly 45% off its summer low in a matter of ~2 weeks. Normally, that would make me nervous about chasing. But when I zoom out, I think the more interesting question is whether this is an overextended rally — or the early stages of a much larger mean reversion. There are a few things I’m watching. 1. The daily RSI is hot. The weekly RSI isn't. On the one-year chart, LDOS closed at $143.83 with its 14-day RSI around 77. By the traditional definition, that's overbought. And after this kind of move, I would absolutely consider a pullback or consolidation normal. But "overbought" doesn't necessarily mean "finished." Zoom out to the five-year weekly chart and RSI is only around 54 That's a very different picture. The short-term move has been aggressive. The longer-term momentum hasn't. That distinction matters because stocks emerging from major declines can remain elevated on shorter timeframes while the larger trend is still rebuilding. 2. $149 looks like the next real test. Using the roughly $98.86 low and $163 prior pivot on the one-year chart, LDOS has now reclaimed the 0.618 Fibonacci retracement around $138–139. The next major level is the 0.786 retracement around $149. From Friday's $143.83 close, that's less than 4% away. More importantly, I don't see a tremendous amount of meaningful overhead congestion between the current price and that level. I wouldn't call it clear air. But I would call it a relatively low-friction zone. That makes roughly $145–149 the immediate area I'm watching, with $149 being the much more important technical hurdle. 3. The real battle may actually be $157–163. If LDOS can clear $149, the chart gets considerably more interesting. There is a major cluster of resistance just above it: * The daily 200-day moving average sits around $157 * The weekly 50-week moving average is around $162 * The 100% Fibonacci retracement is around $163 That gives us a fairly obvious technical progression: $149 → $157 → $162–163 A clean move through that entire zone would represent much more than a short-term bounce. It would suggest that the larger trend may actually be repairing itself. 4. Valuation hasn't followed the price higher yet. This may be the part of the setup I find most interesting. Even after the rebound, TradingView has LDOS at roughly 13.4x trailing earnings and around 11.8x forward earnings. On the five-year chart, that remains a relatively compressed valuation compared with much of the company's recent history. And the underlying business isn't behaving like one that is falling apart. Leidos reported Q2 revenue of $4.56 billion, up 7% year-over-year, including 4% organic growth. Adjusted EPS increased to $3.26, the company generated $761 million of free cash flow, and quarterly bookings reached $4.9 billion. Backlog finished the quarter at $48.7 billion. Management also raised the lower end of its 2026 outlook to: Revenue:$18.2–$18.4 billion Adjusted EPS: $12.20–$12.50 Operating cash flow: approximately $1.85 billion. At $143.83, the midpoint of that EPS guidance implies a valuation of only about 11.6x adjusted 2026 earnings. That's not exactly a momentum-stock multiple. 5. There are still reasons not to chase it blindly. This isn't a perfect setup. The daily RSI above 77 tells me the stock could use some time to digest the move. Margins also deserve watching. Q2 adjusted EBITDA margin fell to 13.8% from 15.2% a year earlier, although the prior-year comparison benefited from several one-time gains. And technically, LDOS is still below several important longer-term moving averages. So I wouldn't be surprised at all to see a retest before another leg higher. In fact, I might prefer it. The $138–139 area now looks particularly important because it combines the 0.618 Fib retracement with the recent breakout area. Below there, I see another potentially important support cluster around $132–135. A controlled pullback that holds one of those areas could reset the daily RSI without doing much damage to the larger thesis. What I'm watching... My base case isn't that LDOS simply goes straight up from here. It's that the stock has transitioned from a falling chart into a potentially constructive recovery. As long as roughly $138 holds, $149 appears to be the next logical test. A decisive break above $149 could open the door toward the far more important $157–163 resistance zone. Conversely, losing $132–135 would make me question whether this is actually a durable trend reversal or simply a powerful post-earnings bounce. That's why I think the two charts need to be viewed together. The one-year chart says LDOS is getting hot and overbought. The five-year chart says it may still have a lot of repairing left to do and room to run. Sometimes both can be true. I'm riding this one all the way back up to ATHs. *This analysis is for informational and educational purposes only and is not financial advice or a recommendation to buy or sell any security. Technical analysis is inherently probabilistic, and past price behavior does not guarantee future results. Investors should conduct their own research and consult a qualified financial professional where appropriate.*