Chart of the Day: Applied Materials Is a Gem of Consistency
The stock has been strong as it prepares to report earnings on Thursday.
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As good as the semiconductor stocks have performed we have also seen strong performance from the equipment group, which includes Applied Materials (AMAT) . This stock is in a fierce uptrend, with higher highs and higher lows.
Each dip has been an opportunity to get on board, but as you see in the chart, those chances are few and far between. The intense price pressure up has had a strong negative effect on the short-sellers, the stock driving them away from the market after a rather high short interest reading early in the spring.
Competitors Lam Research (LRCX) and KLA Corp. (KLAC) reported robust earnings last month, so we expect the same from Applied when it reports on May 14.
Money flows have been strong recently into call options, with interest in the $430 up to $500 strikes out into the summer months. We believe this stock can make a run to higher levels over the coming months.
The chart shows strong support from the indicators, RSI is rising with higher highs, higher lows, while money flow remains positive. MACD is on a buy signal.
Candles are blue, which indicate bullish on the GoNoGo composite of indicators.
We like Applied Materials in TheStreet Pro Portfolio and rate it a "Two," or stockpile on pullbacks.
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At the time of publication, TheStreet Pro Portfolio was long AMAT.
