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I reviewed the technology ETFs XLK, a general technology ETF, and SMH, the semiconductors ETF, plus Apple and Google in my last post, on Monday. In a previous post on Saturday, I reviewed QQQQ, the NAS 100, which is technology weighted. Now I will review the DJIA 30 technology stocks: Cisco, Hewlett-Packard, IBM, Intel, and Microsoft. A summary is at the end of this post.
Cisco
The intermediate-term signal, the comparison of the 25 day & 50 day simple moving averages, still indicates a bear market since February 8. That is, the 25d sma is less than the 50d sma. This reveals the depth of the current pullback. CSCO did regain, for a second time, the 50d sma and 100d sma on February 11, which was a bullish sign. However, the 50d sma was tested in the last session. The current pullback has created price damage that is not being repaired very quickly.
The close on Tuesday of 24.05 is lower than the October and December 2009 highs, which is recent resistance. This resistance is the next obstacle for CSCO, before there can be any thought of regaining the higher January 2010 highs of 24.50+.
The uptrend line in yellow is from the March 9, 2009 market closing low of 13.62 up through the January 29, 2010 closing low of 22.47. CSCO bounced up above this trendline and has maintained the gain. The uptrend line has been held for 16 days, a somewhat bullish price signal even though sideways trading has existed for a few days now. Whether CSCO can continue above this trendline, this rate of price ascent, will determine whether a bull market signal is generated sooner.
The 25d sma continues to descend. The 50d and 100d sma's are nearly flat, ascending just slightly. The 200d sma continues to ascend. The 25d sma breaking down through the 50d and 100d sma's is the problem. CSCO has regained the 100d sma but is struggling somewhat with the 50d sma, as noted. Overall, indications of price weakness persist.
The lowest horizontal yellow line is the 10 month exponential moving average from the monthly chart, which I have overlayed on this daily chart. That is the line in the sand, so to speak, for the long term signal of a bear market. CSCO is above this 22.29 signal with a close on Tuesday of 24.05, which is the middle horizontal yellow line. The highest horizontal yellow line is the benchmark 25.00 price.
Conclusion
Using the intermediate-term 25d/50d sma indicator, CSCO was in a bull market from late March 2009, with a brief neutral signal in mid-July, through late November 2009. Since then, the signal has been alternating betwen long and short with no clear trend.
CSCO rallied off the January 29 closing low of 22.47 and is now back to the January 21 price area. The December 2009 highs, as recent resistance, were overcome once, only to be given back this week. Now this resistance plus the October 2009 resistance must be overcome. CSCO has been trading in a range of about 22.50 to 24.50 since September 10, 2009, exclusive of the January highs.
Holding the current price levels and higher prices will eventually sustain a signal that an intermediate-term bull market has returned through ongoing price strength. CSCO is generating mixed signals and struggling with the 50d sma. The intermediate-term trend is still bearish, but there have been bullish signals. The long-term trend is still bullish.
Hewlett-Packard
The intermediate-term signal, the comparison of the 25 day & 50 day simple moving averages, still indicates a bear market since February 5. That is, the 25d sma is less than the 50d sma. This reveals the depth of the current pullback. HPQ has not been able to regain and hold the 50d sma, which would be a bullish sign. An attempt to regain the 50d sma occurred, and failed, in the last session. The current pullback has created price damage that is not being repaired very quickly.
The close on Tuesday of 50.12 is lower than the November 2009 highs, which is recent resistance. This resistance is the next obstacle for HPQ, before there can be any thought of regaining the higher December 2009 and January 2010 highs of 52.00+.
The uptrend line in yellow is from the March 9, 2009 market closing low of 25.53 up through the February 4, 2010 closing low of 47.03. HPQ bounced up above this trendline and has maintained the gain. The uptrend line has been held for 12 days, a somewhat bullish price signal even though sideways trading has existed for a few days now. Whether HPQ can continue above this trendline, this rate of price ascent, will determine whether a bull market signal is generated sooner.
The 25d sma continues to descend. The 50d sma has leveled off and the 100d sma is barely ascending. The 200d sma continues to ascend. The 25d sma breaking down through the 50d and 100d sma's is the problem. HPQ has regained the 100d sma but is struggling to regain and hold the 50d sma, as noted. Overall, indications of price weakness persist.
The lowest horizontal yellow line is the 10 month exponential moving average from the monthly chart, which I have overlayed on this daily chart. That is the line in the sand, so to speak, for the long term signal of a bear market. HPQ is well above this 46.08 signal with a close on Tuesday of 50.12, which is the highest horizontal yellow line. The middle horizontal yellow line is the benchmark 50.00 price.
Conclusion
Using the intermediate-term 25d/50d sma indicator, HPQ was in full bull market mode from mid April 2009 through February 4, 2010! HPQ regaining the prior bull market rate of price ascent will be difficult, but the long-term price prospects appear very good.
HPQ rallied off the February 4 closing low of 47.03 and is now back to the January 22 price area. The November 2009 highs, as recent resistance, have not been overcome since this pullback. Holding the current price levels and higher prices will eventually sustain a signal that an intermediate-term bull market has returned through ongoing price strength. HPQ is generating mixed signals and struggling to gain and hold the 50d sma. The intermediate-term trend is still bearish. The long-term trend is still bullish.
IBM
The intermediate-term signal, the comparison of the 25 day & 50 day simple moving averages, still indicates a bear market since February 5. That is, the 25d sma is less than the 50d sma. This reveals the depth of the current pullback. IBM has not been able to regain 50d sma, which is a bearish sign. The 50d sma was pinned twice last week. The current pullback has created price damage that is not being repaired very quickly.
The close on Tuesday of 126.46 is lower than the October, November, and mid December 2009 highs, which is recent resistance. This resistance is the next obstacle for IBM, before there can be any thought of regaining the higher late December 2009 and mid January 2010 highs of 131.00+.
The uptrend line in yellow is rather interesting; it is from the November 20, 2008 closing low of 71.74 up through the March 9, 2009 market closing low of 83.48. This pullback has tested this uptrend line more than the July 2009 pullback. IBM pinned this trendline on February 12 and is comfortably above. The uptrend line has been held for 6 days, a somewhat bullish price signal even though sideways trading has existed for a few days now. Whether IBM can continue above this trendline, this rate of price ascent, will determine whether a bull market signal is generated sooner.
The 25d sma continues to descend. The 50d sma has leveled off but is about to begin descending. The 100d sma is barely ascending. The 200d sma continues to ascend. The 25d sma breaking down through the 50d and 100d sma's is the problem. IBM has regained the 100d sma last week but pinned it Tuesday. The 50d sma has not been regained during this pullback. Overall, indications of price weakness persist.
The lowest horizontal yellow line is the 10 month exponential moving average from the monthly chart, which I have overlayed on this daily chart. That is the line in the sand, so to speak, for the long term signal of a bear market. IBM is well above this 119.63 signal with a close on Tuesday of 126.46, which is the highest horizontal yellow line. The middle horizontal yellow line is the benchmark 125.00 price.
Conclusion
Using the intermediate-term 25d/50d sma indicator, IBM was in a bull market from late March 2009, with a brief close test in mid-July, through February 4, 2010! IBM regaining the prior bull market rate of price ascent will be difficult, but the long-term price prospects appear very good.
IBM rallied off the February 8 closing low of 121.88 and is now back to the January 22 price area. Recent resistance, as noted above, has not been overcome since this pullback. Holding the current price levels and higher prices will eventually sustain a signal that an intermediate-term bull market has returned through ongoing price strength. IBM is generating mixed signals and struggling to regain the 50d sma. The intermediate-term trend is still bearish. The long-term trend is still bullish.
Intel
The intermediate-term signal, the comparison of the 25 day & 50 day simple moving averages, still indicates a bear market since February 17. That is, the 25d sma is less than the 50d sma. This reveals the depth of the current pullback. INTC has been able to regain the 50d and 100d sma's, which is a bullish sign. The current pullback has created some price damage that still needs to be repaired.
The close on Tuesday of 20.39 is above or near the September, November, and early December 2009 highs, which is recent resistance. This resistance is the next obstacle for INTC, before there can be any thought of regaining the higher mid October 2009 and mid January 2010 highs of 21.00+.
The uptrend line in yellow is from the February 23, 2009 closing low of 12.08 up through the February 4, 2010 closing low of 19.02. The uptrend line has been held comfortably since, a somewhat bullish price signal even though sideways trading has existed for a few days now. Whether INTC can continue above this trendline, this rate of price ascent, will determine whether a bull market signal is generated sooner.
The 25d sma continues to descend. The 50d sma has leveled off. The 100d sma is barely ascending. The 200d sma continues to ascend. The 25d sma has broken down through the 50d sma but is still above the 100d sma, which is positive. INTC regained the 50d and 100d sma's last week. Overall, indications of price weakness persist, but bullish signs are encouraging.
The lowest horizontal yellow line is the 10 month exponential moving average from the monthly chart, which I have overlayed on this daily chart. That is the line in the sand, so to speak, for the long term signal of a bear market. INTC is above this 19.08 signal with a close on Tuesday of 20.39, which is the highest horizontal yellow line. The middle horizontal yellow line is the benchmark 20.00 price.
Conclusion
Using the intermediate-term 25d/50d sma indicator, INTC was in a bull market from late March 2009, with a brief close test in mid-July, through mid November 2009. Since then, the signal has been alternating between long and short with no clear trend.
INTC rallied off the February 8 closing low of 19.02 and is now back to the January 22 price area. Recent resistance, as noted above, has not been overcome since this pullback. Holding the current price levels and higher prices will eventually sustain a signal that an intermediate-term bull market has returned through ongoing price strength. INTC is generating mixed signals, but some bullish indicators are encouraging. The intermediate-term trend is still bearish. The long-term trend is still bullish.
Microsoft
The intermediate-term signal, the comparison of the 25 day & 50 day simple moving averages, still indicates a bear market since February 4. That is, the 25d sma is less than the 50d sma. This reveals the depth of the current pullback. MSFT has not been able to regain the 50d sma and only temporarily gained, then lost, the 100d sma. The current pullback has created some price damage that still needs to be repaired.
The close on Tuesday of 28.33 is below the October through February highs, which are recent resistance, sheesh. All of this resistance are the next obstacles for MSFT, before there can be any thought of regaining the higher late December 2009 and mid January 2010 highs of 31.00+.
The uptrend line in yellow is from the March 9, 2009 market closing low of 15.15 up through the February 8, 2010 closing low of 27.72. The uptrend line has been tested several times subsequently and was pinned yesterday. Whether MSFT can continue above this trendline, this rate of price ascent, will determine whether a bull market signal is generated sooner.
The 25d and 50d sma's continue to descend. The 100d and 200d sma's continue to ascend. The 25d sma has broken down through the 50d sma and now the 100d sma as of yesterday, which is a bearish sign. The 25d sma breaking down through the 50d sma and now the 100d sma is the problem. Overall, indications of price weakness persist.
The lowest horizontal yellow line is the 10 month exponential moving average from the monthly chart, which I have overlayed on this daily chart. That is the line in the sand, so to speak, for the long term signal of a bear market. MSFT is above this 26.68 signal with a close on Tuesday of 28.33, which is the middle horizontal yellow line. The highest horizontal yellow line is the benchmark 30.00 price.
Conclusion
Using the intermediate-term 25d/50d sma indicator, MSFT was in a bull market from mid April 2009, with a brief close test in mid August, through February 3, 2010! MSFT regaining the prior bull market rate of price ascent will be difficult, with much resistance above.
MSFT rallied off the February 8 closing low of 27.72 and is now back to the January 29 price area. Recent resistance, as noted above, has not been overcome since this pullback. Holding the current price levels and higher prices will eventually sustain a signal that an intermediate-term bull market has returned through ongoing price strength. All the indicators reviewed above are bearish. The intermediate-term trend is still bearish. The long-term trend is still bullish.
Summary
All of these major technology companies are international giants and leading edge endeavors. Both their financial position and financial performance are strong. All have significant foreign sales which are affected by the strength or weakness of the US Dollar. Therefore, the bull market and strength of the US Dollar recently is adversely impacting the financial statements of these companies due to the negative effect of currency conversions. When the US Dollar tops out and the price begins to descend these stocks will bounce up accordingly.
None of these 5 stocks are in full bull mode, of course. All have had a pullback. All are in an intermediate-term bear market and long-term bull market. A quick review of the price status:
CSCO Above 50d sma, but pinned it yesterday.
HPQ Broke down through 50d sma yesterday; still above benchmark 50.00
IBM Below 50d sma, but pinned 100d sma yesterday
INTC Above 50d sma
MSFT Below 50d sma, broke down through 100d sma yesterday, just above uptrend line
Reviewed in previous posts (update):
QQQQ Broke down through 50d sma Monday; just above 100d sma
XLK Below 50d sma; broke down through 100d sma Monday
SMH Below 50d sma; broke down through 100d sma yesterday
AAPL Below 50d sma; broke down through 100d sma yesterday
GOOG Trading sideways below 50d and 100d sma's
INTC is the strongest, being above the 50d sma. CSCO is also above the 50d sma, but pinned it yesterday.
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