Futures for the S&P 500 index, Nasdaq 100 and Dow industrials were little changed late Thursday after the major market averages fell slightly during the regular session. Google-parent Alphabet (GOOGL) tried to clear a buy point, while Amazon.com (AMZN) topped a key level. Fellow FANG stocks Facebook (FB) and Netflix (NFLX) held their ground. Apple (AAPL) continues to move sideways, creating several possible buy points.
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Google parent Alphabet rose intraday to 1,011.54, a new all-time high, and cleared a 1,006.29 buy point. But the search and Android giant ended exactly unchanged at 1,005.65. Volume during the breakout attempt also was weak.
Alphabet’s Relative Strength line has been gradually falling over the past four months, reflecting the stock’s sideways action as the market climbs.
Amazon rose 0.5% to 1,000.93, back above the 1,000 level after hitting a two-month-high of 1,008.44 intraday. Amazon is in a flat base with a potential buy point of 1,083.41. But it’s a late-stage pattern, which is more apt to fail. Amazon’s RS line also has drifted lower in recent months, and is essentially flat with year-earlier levels.
Amazon is roiling ever more retail sectors, though the e-commerce giant relies on its cloud-computing Amazon Web Services for much of its profit. Amazon is leading the smart speaker market with its Alexa-enabled Echo products. Google Home is a distant second with Apple introducing its smart speaker in December.
IBD’S TAKE: Amazon and Netflix are both part of Leaderboard, IBD’s premium service that offers annotated charts of a select number of companies, usually growth names in or near buy zones.
Facebook faded to close down 0.1% at 172.55, as the social networking giant nudges toward a 175.59 buy point. Facebook has had a quiet consolidation, with the Sept. 25 sell-off a notable exception. That day served as a shakeout for Facebook, Netflix and many other big-cap tech leaders.
Also Thursday, Snapchat parent Snap (SNAP) rose 3.6% after spiking 11.4% on Wednesday, while Twitter (TWTR) popped 4.2% on Thursday. But shares of those social networks, which are struggling to add users, are only starting to rebound from long slides.
Netflix rose 0.5% to 195.86, off session highs of 198.62. Netflix got a pair of price-target hikes as more analysts hail the decision to raise subscription rates. Netflix shot above a 190.05 buy point on Oct. 5 on that move, and has remained in the 5% chase zone since then.
Apple shares fell 0.35% to 156 on Tuesday after rising as high as 157.37 intraday. Apple’s stock has been moving slowly for several months. There are several possible entries for the iPhone maker, but the 50-day moving average may be the best potential option.
- The old 156.75 entry: For a second straight session, Apple retook that prior entry intraday, but failed to close above that level. Apple initially cleared 156.75 more than two months ago, so it’s not exactly fresh. Apple sold off last month amid iPhone 8 sales and iPhone X production concerns and has spent some three weeks below the buy point.
- A new base: Investors could wait for a clean slate. Apple is working on a new flat base with a 165.04 entry.
- The 50-day moving average: The problem with breakouts from slow-moving stocks is that after moving higher, shares may soon slide back down. So rebounding from or over the 50-day moving average, an area where mutual funds often step in to beef up positions, may be the best option. Apple has been finding resistance at its 50-day line. Retaking that key level in strong volume would offer a buying opportunity. But creeping over the 50-day in light-to-lackluster trade would not be significant.
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