Chart of the Day: This Tech Position Is Waiting for Momentum to Arrive
We have not seen much upside push yet but that soon may change.
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Moving average resistance is tough to overcome, especially when it has been tagged several times. It is these failures that tell us where the power lies, and each rejection says the sellers are in control. At some point, that resistance will not hold, if the stock is in a longer term uptrend, like Applied Materials AMAT.
This stock has been moving sideways for about two months, with a series of lower-highs and higher-lows. That is the definition of "NO" trend. And, with the 100-day moving average acting like a magnet and then pushing down price, it seems that Applied Materials is just waiting for its moment to arrive.
The indicators are mixed, but we can see a budding uptrend taking place during the prior month. That move was enough to get this chart back into at least neutral position. Money flow in the bottom pane is bullish and stochastics in the fourth are ready to turn upward. Technology earnings are happening in a few weeks and that might stoke some interest in Applied Materials.
We rate Applied Materials a "Two" in the Pro Portfolio, a stockpile on pullbacks.
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The Pro Portfolio is long AMAT.
