The Nasdaq 100, which is the strongest of the main US stock indices finally broke its 2019 uptrend on Friday, as Trump was able to feed massive uncertainty in the markets, as investors lost complete confidence in Trump & most likely any hopes for the US to avoid a recession.
 
Leading up to Friday's shocking sell off in US stocks, the muted rally we saw during last week of small moves higher was in fact made on terribly low volume, which is considerable below the daily average.
 
The low volume during a move higher in trend, was similar to the slow run higher in July 19 to new all-time highs. This was also just before a strong sell off on increased volume that occurred. If you’re paying attention this would have been a big red flag for traders & investors.
 
Another red flag for the Nasdaq 100, is that we have confirmed a lower high and lower low signaling a change in control from buyers to sellers in the daily charts.

Looking ahead for the Nasdaq 100, the support area of 7,400 is the last final confirmation required from the market before we can confirm a change of trend. Therefore Monday's trading is super important for short term direction for the Nasdaq especially if we clearly close below this area. A breach of 7,400 support would indicate the next support level of 7,025 for the Nasdaq 100
 
Lastly unless there is some miracle from the Central Banks with more intervention, and we see a big shift in bullishness. With the Nasdaq 100 somehow jumping back above its uptrend line and above the 52 day moving average (green line).  We are likely looking at the start of the end of the bull market in US stocks.

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Apple share price finds itself in a rather interesting position on the weekly chart. If you take a look at the price action from the start of the 2019 you will notice its uptrend, with the price above the 52 weekly moving average, with higher lows formed.
 
However if you step back on longer time frame and view the chart you will notice that since December 2018 when Apple broke below the long term uptrend line, it has failed to move back above this trend on a consistent basis. In addition the price action has been bouncing off a large triangle pattern on the weekly chart for a third time.

If this were to fail and the price action broke to the downside this would be quite bearish for Apple & US stocks as the weighting of Apple would drag down the Nasdaq & S&P500. When observing triangle patterns the price action usually breaks in the direction of the trend, so this means the odds suggests that Apple either this week or in the coming weeks will break the current triangle pattern to the upside.

To confirm this a clear break of $212 resistance would need to occur. If this happens we will likely see a move towards $228 resistance. Based on the likely odds, this would also mean that the SPX index would hold its most recent bounce off the 200 day moving average and confirm a higher low, with a likely move to another higher high and new all time record high in the SPX.
 
Therefore the next few weeks will be critical for Apple investors & US stocks overall and likely dictate the trend going forward in the medium term for stocks.

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Google recently released its Q2 earnings to the market and looking at the monthly charts of its parent company Alphabet, the market appears quite happy with the most recent earnings results. The monthly chart only has a few trading days left to complete, with the current price action as of last Friday the 26th of July, Google is currently showing a breakout pattern above $1,227 resistance.
 
Considering that Google has been consolidating in a sideways pattern since early 2018, if Google can close above $1,227 for the monthly this will be a significant milestone for shareholders. The one important red flag with potential breakout pattern, is that volume for Alphabet is below its average monthly volume. There is another three trading days left of trading to increase volume levels, but given the earnings release and close to the end of the month you would like the volume to much higher to go along with this breakout potential.
 
On the bullish case if we do see a breakout pattern completed, we have a potential target of approximately $1,490-$1,500 resistance area on the monthly charts, which is based on the average distance away from the 52 month moving average that Google price action normally trades away from. Since those levels if achieved would be new all-time record highs, this is the only suitable method of targeting ahead.

The bearish case if Google price action was to fall back below $1,227 level by the end of July 19, then we would of have achieved a triple top resistance pattern. Which based on history would mean we would see a likely target back to $1020 support area, which would also mean that its long-term uptrend line would of also been breached if this was to be achieved.
 
Given the index weighting of both the S&P 500 and Nasdaq Indices, the likely success or failure of Google's price action is likely to have a decent impact on these two indices over the coming months.

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The FANG index consisting of Facebook (FB), Amazon (AMZN) Netflix (NFLX) & Google (GOOGL), concluded the week on a very bearish tone, reversing all the gains made earlier in the week. With the market finishing at the lows of the week and back below support of 2,575 level. Based on how the index finished on Friday I’m expecting a move towards its 2,500 support in the week ahead.
 
The FANG index which in 2018 outperformed all of the US stock indices, is actually now under performing in 2019. The FANG’s has failed to reach or make a new all time high level from the Jan - April 2019 rally, unlike the S&P 500, Nasdaq index.

More importantly based on the price action that occurred over the last few weeks, saw the FANG index make a new lower low and lower high pattern on the failed rally attempt this week. This indicates that the FANG index is now firmly in a bearish position, with the sellers in control of the index and sitting below the 52 day moving average. This contrasts strongly with the DOW, Nasdaq & S&P 500 which have all failed to confirm a lower high as of yet.

Moving forward, depending on whether the index is able to hold the 2,500 level in the short term, will decide on whether the index moves straight pass 2,500 support level and make its way towards the 2,360 level over the next few weeks. Given where the current price action is relative to the distance from the 52 day moving average line, suggests the FANG index can easily reach the 2,360 on the next down leg move.

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The barrage of negative news flow, week after week has finally taken its toll on the stock price. With just a few trading days left until the end of the month it looks like TSLA has broken a key support level of $266 on above average volume. The price action this month with a breakout lower than support is a rather big warning to Tesla bulls that the party is over and it’s time to look at their options going forward.

Based on the monthly price action this month, together with the price relatively close to the long term moving average (green line), the next two levels of support are within reach over the second half of 2019. The next initial support level which was also a major level previously is around $188 - $189 or a $45 drop from current levels. This could easily be achieved in the next month or two. Beyond the first level of support, the next area to watch is between $126 - $128.

The daily chart for Tesla is looking just as bearish as the monthly chart price action. With the last two trading days breaching its $250 support level of extremely high volume and negative news flow including a large miss on already revised lower earnings this week.

Going forward this week, we are likely to see soon a short-term reversal / consolidation phase take place, with a possible target of its old $250 support level, which is now its resistance area. Given the daily chart has been experiencing a series of lower highs and lower lows, leading up to this week we could see a breakout for Tesla. I'm expecting any rally in share price when it does occur to be short lived.

Once we have seen a consolidation take place, I'm expecting a move to the next level of support on the daily chart of $205 over the coming weeks and months. Especially given the company itself requires a capital raising soon, has high debt levels and has negative cash flow within its current business plan.

For Tesla bulls this month price action on both the daily and monthly chart is an early warning on further weakness ahead for this “Auto Tech” stock for the remainder of 2019.

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This week was a monumental moment for U.S tech stocks, as they reached their previous all time high resistance / mountain peak around 7700, and for a brief moment surpassed this level making a new all-time intraday high around 7715. The week finished off with the highs at around $7690.

This week was also interesting as the index reached prior resistance area, while also hitting the bottom of the long term uptrend line that had been established in early 2016 on the weekly chart, signaling it hit two different resistance areas that have come together. This is significant as I'm expecting some volatility ahead with a pullback coming soon as a consequence of reaching these levels.

The other reason why I believe this, is that the weekly moving averages are quite stretched from the current price action. The current distance shown by the arrows is roughly the same distance as the previous separation before we saw the index pull lower.

Unlike the previous time this occurred, we saw a significant drop of close to 20% off the peak. I'm not expecting as big a fall to occur with the upcoming consolidation period ahead. One of the main reasons for the difference is that the FED has now completely performed a 180 turn on its monetary policy to appease the markets.

Based on the assumption of the continuation of global central banks to pump liquidity in the global markets, I'm looking for a more mild pullback and an eventual move soon to either the first support level area of 7375, or potentially a bigger move towards 7100 support area.

After we have seen several weeks of consolidation and the moving averages have had a chance to catch up to the price action, I would be looking to see the markets begin to attempt to move back to the prior resistance area of 7700, before it then makes another attempt to march towards a new all time high, with an eventual higher highs created.

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The tech heavy Nasdaq index has led the 3 major indices with the surprising V shaped recovery off the Dec 24th lows. This week the Nasdaq 100 is set to hit the old all time high resistance level of 7,655 as well as the original long term uptrend line on the weekly chart (shown with green rectangle box).

The reason this is important is because the market is facing two major resistance areas simultaneously which could cause disruption to the current uptrend for 2019. When the long term uptrend was breached in late Oct 18, the market gave the signal that something was wrong and to pay attention.

Given the bullishness of the market lately, it's likely we will retest the old resistance level this trading week. The key question once this has been achieved is what happens next?

With the steepness of the rally in 2019 and the uptrend line shown, we can only tolerate a minor pullback / consolidation period otherwise we could see the market break the uptrend line into the red circle area.

If this occurs we would have to review any bullish positions on the Nasdaq 100 index and show caution to potential short term volatility and draw-down period ahead.

Given the price action is currently sitting comfortably above the weekly chart moving averages, I'm suggesting that we could see a number of weeks of volatility and consolidation ahead, rather than a suggestion it's time to look at potential shorts for the Nasdaq index.

My switch to an overall bearish stance for the Nasdaq 100 will occur when I see the price action form a lower high and lower low pattern on the daily chart. Until then, I'm only highlighting caution ahead for the major inflection point above.

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Amazon (AMZN) Chart Review

Amazon has been on an incredible bullish run over the last 6+ years for investors and traders that have held long term positions in Amazon.  For the loyal shareholders they have been well rewarded as the stock has climbed by over 370% since the lows reached in March 2011. If you had held the stock over a longer period the returns would be even higher.

Back in April of last year it broke out of a consolidation period and accelerated its uptrend pace as the stock started to climb faster, as the stock continued to make new record highs reaching a closing high back on the 5th of October of $844.36.

Fast forward to the end of November 2016, and it appears that Amazon has broken its most recent uptrend (See chart below) with the current price sitting at $762.52.

Amazon's Uptrend Within An Uptrend

The good run for Amazon appears to be slowing down for now, as the current uptrend has ended on a monthly chart. With one more trading day left for the stock it appears unlikely to jump back within the uptrend. If the break of the uptrend occurs the most likely target over the medium term for Amazon is a move towards its previous uptrend which is highlighted within the chart.

The first level of support for the stock to reach is around the $676 level. Given the price is above $500 per share you have to give a little bit more flexibility with support and resistance levels as the levels are not as closely defined.

Consolidation Pattern Possible

Amazon may not necessarily fall considerably over the next few months, as its a very strong bullish stock relative to the S&P 500 market. Its quite possible that you could see the stock struggle to move higher with the likely outcome that it move sideways to slightly down as it heads for the previous uptrend forming a consolidation pattern.

Lastly the momentum has fallen sharply over the last few months making a lower low even though the stock is near all time highs, indicating there is divergence and the rally is running out of steam.

The break of the uptrend for weekly chart below is not as clearly defined. The stock had recently closed below the uptrend 4 weeks ago only to pop above the uptrend again, with a rally to coincide with the overall market move higher from the US election results.

With only 1 trading day completed into the week the stock has once again closed below its uptrend. As its a weekly chart it would be ideal to wait for a completed weekly candle at the close on Friday to confirm that Amazon has also closed below its uptrend on a weekly chart.

If the confirmation is complete for a reversal in trend, expect the stock to move towards its first support level around the $681 - 682 level. If support is respected and it holds that level you could see the stock once again attempt to reach its prior all time highs around the $842 - 843 resistance level.

I have circled the previous false attempt to close below its uptrend back in February this year, so make sure to be patient and seek confirmation.

Momentum is only marginally positive at 2.38 haven fallen from over 157 several weeks ago. This indicates that the strength of the trend has practically disappeared. Look for momentum to move to the negative soon to coincide with the stock moving towards support.

The trend is clearly over on the short term daily chart, where I have circled on the chart where it popped lower closing below the long term uptrend.

After breaking its previous support of $788 it proceeded to the $717 / 718 level of support, after retracing back to the new resistance level of $788 creating a change of polarity. Once it reached resistance it has proceeded to begin falling again confirming the new resistance level. This is a bearish signal as the bears are now in control on a short term basis.

The price is currently sitting below its 50 day moving average and the 10 day moving average has crossed below the 50 day moving average signalling a reverse in trend.

Caution Ahead

Normally based on the price action only I would say that the stock is moving next to its $717 / 718 support level again. However the momentum indicator is showing divergence having recently turned positive and accelerating higher. This indicates to me that we could see Amazon make a push higher to break above resistance of $788. If this was to occur it would also reverse it new daily chart downtrend.

Based on the conflicting indicator we would need to see more price action from Amazon to determine its likely direction in the short term.

By the end of the week we should have confirmation on all 3 charts the trend of Amazon moving forward.

Thanks for checking out my latest chart review.

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Netflix (NFLX) reported its quarterly earnings with strong subscriber numbers, which was posted after the US markets closed. Because it reported strong than expected subscriber growth of 370k in the US and 3.2mil internationally the stock is up close to 20% at $199.25 in pre-market trading at the time of writing this.

Can The Bull Run Restart For Netflix?

Today we take a closer look at Netflix after it reported strong earnings and subscriber growth, propelling the stock (in pre-market) within its all time high prices around the $130 mark.

Since 2012 Netflix has enjoyed a spectacular run in price climbing from around $7.50 - 8.00 level back in 2012, all the way up to $130.93 closing high price last December. In a short 3+ year period Netflix has climbed over 1500%.

After the huge run in price the up trend ended and the price fell back to around the $85 level on 3 occasions marked with the 3 black circles on the support line. (See chart below)

The pre - market trading price is shown with the horizontal line inside the circle, to give you an indication on where its likely to trade when the market reopens based on the price at that the time of writing.

Since the price has confirmed the break out of the mini downtrend and is now approaching the resistance level of $129.25 it has a good chance to break out to new record highs and restart its bullish uptrend that ended last December.

Viewing the Netflix chart on a shorter time frame with a daily chart, we can see that the price had been struggling to break out of the range in price. In fact the range of prices was being squeezed as the market tried to determine the new direction. (See chart below)

On a daily chart the next level of resistance is around the $111.50 as noted in the chart. However based on the pre - market price it looks to open comfortable above resistance. This puts it in contention to reach the next level of resistance of $129.25.

If Netflix can close on a daily chart above resistance level of $129.25 and hold above it for the weekly close as well, than Netflix can recommence its uptrend to new record highs.

Source:

zerohedge.com

Disclaimer: This post was for educational purposes only, and all the information contained within this post is not to be considered as advice or a recommendation of any kind. If you require advice or assistance please seek a licensed professional who can provide these services.

Intel (INTC) Stock Review

When you think of a technology stock in 2016, most people would not consider Intel as one of their top 3 picks for technology names. Yet Intel who during the Tech boom rode to dizzy heights, climbing from just under $30 a share back in June 1999 to an all time high of $75.81 in the first week of September 2000, which was a 152% return in a 15 month period.

After the tech boom crashed in late 2000, Intel like many technology stocks fell sharply and continued falling as Intel languished lower for the next 8 years to a multi year low of around $12 a share back in February 2009.

Intel Begins To Recover From Tech Bubble Crash

After touching the low in 2009, Intel eventually reversed its downtrend and followed the market higher as the recovery from the 2008/9 crisis lifted the whole market.

Intel has not looked back since than, as the stock has steadily continued higher over the last 7 years and last week reached a multi year of high $38.05 before pulling back from $37.25 resistance level on the monthly chart. (See chart below)

Can Intel Reached the Tech Boom Highs?

If Intel is able to close above the $37.25 resistance level on a monthly chart the next resistance level is around $41.15.

The interesting thing is that after the $41.15 level, there is not much resistance until you reach the $63 a share level. This would be a big move for Intel to move to from the $41.15 level. So if Intel could sustain the momentum and close above $41.15 on a monthly chart it has the opportunity to head significantly higher.

Viewing Intel on a weekly chart, you can see over the last 2 years that Intel has been a wild ride. After making multi year highs back in December 2014 around the $37.65 level, it fell all the way back down to $25.00 a share in August 2015. It then preceded to climb back higher again to the previous highs of 2014, shown with the 2 black circles (see chart below).

Failure to close above the current resistance level of $37.65 on a weekly basis, Intel would most likely head back to $35.00 support level. (Shown in weekly chart below)

Zooming in on a daily chart below for Intel over the last few months, you can see that the chart is quite bullish. Intel is currently above the 50 day (black line) and 100 day (red line) moving averages, and its within its uptrend .

Last week Intel tried on 3 occasions to close above resistance intra-day (see circle below), before closing below resistance on each attempt.

After rejection of resistance Intel could test support area and its uptrend shown with the square box (see chart below), before trying again to close above resistance and break out to new highs.

If Intel failed to hold the $36.55 support level, its next support level would be at $34.25, which would also mean that the daily uptrend would of reversed. However this is unlikely given the bullish indicators Intel is currently displaying on all 3 charts shown here.

If you liked Intel's stock review, you can take a look at some of the more recent stock reviews with, Apple, Wells Fargo and Australian REIT sector.

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