Thursday, June 19, 2014


Today I thought I would comment on the five stocks I have been following. You'll notice that none of the five are at new bull market highs while the S&P 500 made a bull market high yesterday. This is a slight bearish situation which would become more so if the Dow and the S&P 500 were to drop below their 50 day moving averages. Since these moving averages are still well below the market I don't think this bearish divergence is terribly significant (yet).

The most bearish of these five is Twitter (second chart from bottom). TWTR is in a bear market and I think that 20 or so is a reasonable downside target. The current rally has not yet moved TWTR up as far as as the 11 point January-February rally and I think that this stock will hold below 41 resistance based on this measurement.

Th top chart shows the recently split (7 for 1) Apple stock. Since its low in 2013 AAPL has been in a new bull market which promises to take it above the 100.70 all time high. On the way up from that low there have been three reactions of 10-11 points and as long as this rhythm is maintained I think AAPL will continue to move higher. I'd say right now that 108-10 is a reasonable expectation.

Below the AAPL chart is a chart of Google. GOOGL is in a position very similar to Facebook (middle chart) and Visa (lower chart). All three have reacted to rising 200 day moving averages (red lines) and then rallied above declining 50 day moving averages. Then all three have reacted to the 50 day moving average which is beginning to level out.

I think GOOGL, FB and V all have a good shot at making new bull market highs. The only thing which would force me to abandon this forecast would be a break in the general market which takes the S&P and the Dow below their respective 50 day moving averages.  These moving averages are currently at 16,585 in the Dow and 1895 in the S&P.

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