Week 20 Big Tech Stocks Trending and Performance

Summary

Tech stocks keep going higher and higher even as they become more and more overbought. It would be foolish to get in the way. I do not know when this party is going to end so I have not participated after Q1. Other than TSLA, I have not shorted any of the stocks directly. And the few times I have shorted QQQ or XLK in Q2 so far have not been profitable trades. So, I will wait until the trending reverses (if it does at all).

I have shortlisted TSLA, META and PYPL as possible trades. TSLA will be to the downside. META, it depends on what the next price moves are. And for PYPL a possible upside trade.

NVDA, SNOW and ZM have earnings releases next week.

Trending Heat Map

The Big Tech stocks continue to defy gravity. As soon as I see a little weakness somewhere, the stock immediately wipes that weakness off and goes back to trending bullish. Look at INTC, MU, TSLA and ZM as indicators of that this week.

Out of these I have only played TSLA recently and that was to the downside. Luckily, I came out unscathed but in hindsight that was foolish to get in the way of a Tech juggernaut. I do not intend to trade any of these in the near future.

Performance

After a poor April, there has been surprising strength in TSLA, ZM, AMD and NFLX. NVDA continues to march on after being flat in April.

The stocks that had good Q1 but have been weak in Q2 so far are BABA, BIDU, INTC, SQ, TSLA and ZM. All these stocks returned more in Q1 than YTD. And the ones that have retained their strong performance are AAPL, AMD, AMZN, CRM, GOOGL, META, MSFT, MU, NFLX, NVDA and SNOW.

Chart Observations

CRM looks overbought and has 3 unfilled gaps below and 1 unfilled gap above.

GOOGL looks overbought and has 1 unfilled gap below and 1 unfilled gap above.

NVDA is close to a congested resistance level. It looks overbought and has 2 unfilled gaps below. It does report earnings next week. I will not be doing anything. Just staying away. If it gaps up or down, there will be a trade opportunity as it fills that gap later.

TSLA price is at the top end of a wedge pattern. It just filled a gap above. There is no indication of a bearish to bullish reversal indicated by the 150-day moving average. It is definitely a candidate for a trade to the short side.

META chart is so interesting that I am pasting it here.

META has this habit of gapping big at earnings. And then it does eventually fill those gaps as well. I have marked the current gaps with horizontal lines. We can see the big unfilled gap above from Feb 2022 that remains unfilled. So, that is a possibility. The last 3 earnings had gap ups all of which are yet to be filled. The current price is also at a level of resistance as it touches the gap down from Feb 2022. So, the natural thing for price to do would be to fall down and fill the first gap below which is at 214.18. That represents a fall of -12.81% from current level. If you are in the bull camp and believe we keep going higher than the gap above is at 289.08 which amounts to +17.68% from current level. A stock to watch for a trade either way.

AAPL price is around a strong resistance level. There are 3 unfilled gaps below and is somewhat overbought. I would not recommend putting new money in the stock now.

AMD looks overbought. It is also hitting up against a resistance level. There are 3 unfilled gaps below and 1 above. No recommendation.

MSFT looks overbought. It has 2 unfilled gaps below. No recommendation.

NFLX took 9 months to fill the gap created in April 2022. Does not look as overbought as some of the other big tech stocks. It has an unfilled gap below created at the last earnings release. There is also an unfilled gap above at 507 level that it will eventually fill. I think it fills the gap below first though. No recommendation.

MU does not look as overbought as other big tech stocks. There is 1 unfilled gap above and 1 unfilled gap below. No recommendation.

SNOW has been slowly forming a bearish to bullish reversal for a while now. It seems it can continue with its move up. However, there is strong overhead resistance coming up. There are 3 unfilled gaps below which it seems will get filled first before the next meaningful move up. No recommendation.

AMZN is trying to make a bearish to bullish reversal. There are 2 unfilled gaps above and 2 unfilled gaps below. No recommendation.

PYPL has fallen to Sep 2017 levels. It fell hard at earnings and created an unfilled gap above at 74.89 which is +22.93% above current level. So, if the stock price starts to move up, then I would play a long trade for the price to fill the gap at some point.

INTC - nothing to say and nothing to do.

SQ is really untouchable right now. May be look at it later if it tries to fill the unfilled gap above.

BIDU has so many unfilled gaps below that it is inevitable it will fill in that history at some point. There is also an unfilled gap above. No recommendation.

ZM price has been steadily and calmly going up from a low in early May. If it continues, then 73 level should be reached soon from the 69 it is at. Not sure that gives a good enough risk/reward but that is where it will hit up the 150-day moving average. Hard to believe it hit 568 level in Oct 2020 at the height of Covid. Now it is back around its IPO levels.

BABA price has traded very bad. There are still 3 unfilled gaps below. There are also 2 unfilled gaps above. But the gaps below seem like will get filled first.

Expected Price Range

NVDA earnings date is May 24.

SNOW earnings date is May 24.

ZM earnings date is May 22.

That is why they have higher expected moves.