Where Are Stocks Going?
Stocks should continue to see gains in the days ahead despite the late day pullback on March 19. The charts and fundamental valuations continue to show a favorable outlook for the S&P 500, and today’s fade seemed more like a technical gap fill than the start of something more severe, despite the negative trade headlines. Nothing from today’s trading has changed my view of the S&P 500 eventual rise to around 2,900 and potentially higher over the next couple of weeks.
I could even argue that my outlook is a bit brighter given the big move higher in Amazon’s stock throughout the day.
S&P 500 (SPY)
The chart below shows that the S&P 500 gapped higher, only to close that gap by days end. Again, we have seen this multiple times in the past and today’s move is nothing new. Mr. Predictable.
S&P 500, spy
The Russell did fall today, but it also continues to hang around the 1,562 level. The setup in the chart is still favorable and suggests an eventual take-out of the 1,592 level and move up to around 1,710.
Amazon.com Inc (NASDAQ:AMZN) was the big winner today, rising and finally clearing that $1,770 level, although it did give back some of those gains by days end. However, I suspect tomorrow may be different. We can see in the chart, that volume levels have risen on the days the stock has increased, a sign of strong buying.
Another stock having a big move today is Advanced Micro Devices Inc (NASDAQ:AMD) up over 11% after Google (NASDAQ:GOOGL) confirmed a partnership for a new streaming gaming platform. AMD crossed over a critical level of resistance today at $25.70. I think that the shares may eventually climb back to around $29.50.
Micron Technology Inc (NASDAQ:MU) continues to rise, albeit with the tailwind of a hot Semiconductor sector behind it. But now things may get tough for the stock as it approaches that wall of resistance around between $40 and $42. The company reports results tomorrow. I haven’t seen much to sway my opinion from the other day.
It looks like NVIDIA Corporation (NASDAQ:NVDA) is intent on filling that giant gap up at $198. This is a new point of view for me, but sometimes we need to change when realizing we are wrong.
NXP Semiconductors NV (NASDAQ:NXPI) has a bullish flag pattern forming, which would suggest a break out may be on the way resulting in a rise to around $106.
Note: my data provider had the wrong release date. The company reported weaker than expected results and guidance after the close of trading on March 19, resulting in shares falling. The company noted in the release: “Slowing international macroeconomic conditions and weaker global trade growth trends continue, as seen in the year-over-year decline in our FedEx (NYSE:FDX) Express international revenue,”
Talk about being in a tight spot, FedEx reports results tomorrow, and the chart shows you just how torn the market is. The stock is resting right on the cusp of a major break out or break down. The shares have failed multiple times to rise above $184. For the sake of the global economy, I hope FedEx has something good to say. There is a gap to be filled up around $200, and the relative strength index is starting to trend up. With that, I will guess that FedEx rises following results and head back towards $200.