Signal Watch: Viewing the Numbers on Shares of Nvidia Corp (NVDA)

Watching shares of Nvidia Corp (NVDA), we have recently seen that the SuperTrend is currently lower than recent stock price levels. Active traders …

Watching shares of Nvidia Corp (NVDA), we have recently seen that the SuperTrend is currently lower than recent stock price levels. Active traders may be tracking the signal in order to figure out if the stock has entered into sell territory.

Successful investors are typically well aware of portfolio holdings at any given time. They tend to regularly review the portfolio to make sure that the combination of stocks is in line with goals and contributing to the outlined strategy. There may be times when everything seems to be in order after a thorough portfolio review. Other times, there may be a few changes that can be made. Maybe there are one or two names that have been over performing providing a big boost to the portfolio. On the other end, there could be a few stocks that are impacting the portfolio in a negative way and they may need to be addressed. Although constant portfolio monitoring may not be overly necessary for longer-term investors, regular portfolio examination is generally considered to be a good idea.

The 14-day ADX for Nvidia Corp (NVDA) is currently 23.10. Many chart analysts believe that an ADX reading over 25 would suggest a strong trend. A reading under 20 would suggest no trend, and a reading from 20-25 would suggest that there is no clear trend signal. The ADX was created by J. Welles Wilder to help determine how strong a trend is. In general, a rising ADX line means that an existing trend is gaining strength. The opposite would be the case for a falling ADX line.

Tracking stock levels, Nvidia Corp (NVDA) has a 14-day Commodity Channel Index (CCI) of 67.23. Even though the name contains the word commodity, CCI can be used on other investment tools such as stocks. The CCI was developed to typically stay within the -100 to +100 levels. Traders may use the indicator to determine stock trends or to identify overbought/oversold conditions. A CCI reading above +100 would imply that the stock is overbought and possibly ready for a correction. On the other hand, a reading of -100 would imply that the stock is oversold and possibly set for a rally.

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The Relative Strength Index (RSI) is a highly popular momentum indicator used for technical analysis. The RSI can help display whether the bulls or the bears are currently strongest in the market. The RSI may be used to help spot points of reversals more accurately. The RSI was developed by J. Welles Wilder. As a general rule, an RSI reading over 70 would signal overbought conditions. A reading under 30 would indicate oversold conditions. As always, the values may need to be adjusted based on the specific stock and market. RSI can also be a valuable tool for trying to spot larger market turns. Nvidia Corp (NVDA) has a 14-day RSI of 62.58, the 7-day is at 66.68, and the 3-day is resting at 52.92.

Looking at some moving average levels on shares of Nvidia Corp (NVDA), the 200-day is at 160.53, the 50-day is 166.77, and the 7-day is sitting at 181.80. Moving averages can help identify trends and price reversals. They may also be used to help spot support and resistance levels. Moving averages are considered to be lagging indicators meaning that they confirm trends. A certain stock may be considered to be on an uptrend if trading above a moving average and the average is sloping upward. On the other side, a stock may be considered to be in a downtrend if trading below the moving average and sloping downward.

Checking in on the numbers for Nvidia Corp (NVDA), we can see that the company has a Williams Percent Range or 14 day Williams %R of -21.97. In general, if the reading goes above -20, the stock may be considered to be overbought. On the other end of the spectrum, if the indicator goes under -80, this may show the stock as being oversold. The Williams Percent Range or Williams %R is a technical indicator that was developed to measure overbought and oversold market conditions.

When watching the day to day movements of the market, investors often have to be careful not to let external factors cloud their judgment. From time to time, there may be certain stocks taking off that look highly tempting to purchase. Getting into a position based on short-term price movements may be a specific strategy for some, but it may be highly costly for others. Even if a stock has been on a big run that the investor might have missed out on, there is no guarantee that the run will continue higher. Although there may be potential in highly publicized stocks, it may be wise for investors to do their own research and then decide if the stock fits with the overall goals.

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Bitcoin Price Indicator May Signal Next Leg Higher

History looks to be repeating itself in the bitcoin market, as a key indicator’s bullish turn could mark the beginning of the next meteoric price rally.

History looks to be repeating itself in the bitcoin market, as a key indicator’s bullish turn could mark the beginning of the next meteoric price rally.

The world’s most valuable cryptocurrency’s price action seen over the last eight months is very similar to the moves seen in 2015, according to Bitstamp data. For instance, the bitcoin bear market ended near $3,100 in mid-December 2018 and prices built a base below $4,000 in the following three months before breaking into a bull market on April 2.

Notably, the bear market drop ran out of steam two months before the 50- and 10-week moving averages confirmed a bearish crossover (in February 2019).

Further, the new bull market began two months following the confirmation of the bearish crossover. That is hardly surprising as bearish crossovers of long duration MAs are big-time lagging indicators and often mark bear market bottoms.

What’s more interesting is that the previous bear market (2014) had also run out of steam in the run-up to the bearish crossover and the confirmation of the crossover was followed by a bullish breakout, as seen in the chart below.

Weekly chart

The bear market, which began at the end of 2013, ran out of steam at lows near $150 in January 2015. The 50- and 100-week MAs produced a bearish cross in April and a bullish reversal was confirmed at the end of October 2015.

Note that the bull market had stalled around $450 following a quick rise from $320 to $500 in November.

The cryptocurrency resumed the bull market in the last week of May 2016 after prices rose 18 percent and the 50- and 100-week MAs produced a bullish crossover.

More importantly, BTC went on to hit fresh record highs above $1,200 in February 2017.

As of now, BTC is trading around $10,300, having rallied from $4,000 to $13,880 in the second quarter. Essentially, the bull market has stalled in the last few weeks.

With history repeating itself, there is a strong reason to believe that the bullish crossover of the 50- and 100-week MAs, if and when, confirmed, could mark the beginning of a meteoric rise well above $20,000.

Currently, the 50- and 100-week MAs are located at $6,556 and $7,668, respectively.

Disclosure: The author holds no cryptocurrency assets at the time of writing.

Bitcoin image via Shutterstock; charts by Trading View

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Tezos (XTZ) Price Analysis – September 13

For the past 17 days now, Tezos has been in consolidation mode, roaming around the $1 level, which appears to be strong support for the bears to …
Tezos price: $1
Key XTZ resistance levels: $1.2, $1.31, $1.4
Key XTZ support levels: $0.9, $0.8, $0.6

*Price at the time of writing


Tezos price long-term prediction: Bearish

The price of Tezos has continued to witness a bearish correction, leading to a bull flag pattern forming over the past months. In early August, the token tested the upper boundary of the channel at $1.6 before falling to $1, where XTZ is changing hands at the moment.

Buy/Sell Tezos

As we can see on the daily chart, the price drop has brought the market under the bearish radar.

For the past 17 days now, Tezos has been in consolidation mode, roaming around the $1 level, which appears to be strong support for the bears to surpass. If the bears can successfully drive XTZ below the $1 support, we can expect a bearish continuation towards the lower boundary of the channel.

The closest key support to look out for is $0.9, before moving further to $0.8 and $0.6. However, if the sellers remain weak at the $1 support, the XTZ price may turn bullish and climb back towards the $1.2, $1.31 and $1.4 resistances, meeting the channel’s upper boundary.

While moving sideways, the RSI is still showing bearish momentum. The Stochastic RSI is also falling back to the oversold region, suggesting that the bears are gaining control.

Tezos price medium-term prediction: Bearish

A look at the 4-hour chart suggests that the XTZ bears are losing momentum inside the wedge pattern which has been playing out since August 15. However, the sellers still remain on top of the action. Currently, the price is caught in a tight range between $0.95 and $1.05, suggesting that a surge in volatility is lurking around the corner.

For an upsurge, we can expect a price jump to the $1.1, $1.2 and $1.3 resistances. Conversely, a downward surge could position the market in a more bearish scenario, meeting $0.9, $0.8 and $0.7 supports.

After testing the 50 level of the RSI indicator, Tezos is now positioned in a downward direction. If the RSI can manage to climb above the mentioned level, we should expect a positive move in the market. As suggested on the Stochastic RSI, the XTZ bulls are getting weak – the bears may take over soon.

Tezos price short-term prediction: Bearish

The bears have continued to take over the Tezos market on the hourly chart. Following the eroding falling wedge pattern, it appears that the buyers may gain control of the market as the bullish breakout is likely to occur. However, the $1.04, $1.07 and $1.10 resistances could put a stop to the price climbing further.

If the price fails to break upwards, the XTZ market will continue its bearish move towards the $0.98, $0.95 and $0.92 supports. Nevertheless, the last 24 hours of trading has brought a slight positive price change of +0.69%.

As revealed on the RSI, Tezos has successfully climbed above the 50 level, reflecting the recent buying pressure in the market. The price may further increase if the RSI continues to trend above the previously mentioned level. The Stochastic RSI is currently down, revealing bearish exhaustion in the market.

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Shining the Spotlight on CME Group Inc (CME)’s Numbers: Technicals At a Glance

CME Group Inc (CME) are being closely watched by investors as the firm’s Mesa Adaptive Moving Average (MAMA) has dipped below the Fractional …

CME Group Inc (CME) are being closely watched by investors as the firm’s Mesa Adaptive Moving Average (MAMA) has dipped below the Fractional Adaptive Moving Average (FAMA), indicating that a potential bearish move might be forthcoming. The MESA Adaptive Moving Average, which was developed by John Ehlers, is a technical trend-following indicator which adapts to price movement “based on the rate change of phase as measured by the Hilbert Transform Discriminator”. This method of adaptation features a fast and a slow moving average so that the composite moving average swiftly responds to price changes and holds the average value until the next bar’s close. The author states that because the average’s fallback is slow, trading systems can be created with almost whipsaw-free trades.

Stock market triumph can be just as much about learning how to minimize losses as it is about picking winning stocks. Not even the most seasoned professional investors are right all the time. Successful investors know how to act quickly and protect themselves from big losses. Sometimes those sure-fire stock picks don’t perform as planned. Being able to detach from any emotion that one might have to a certain stock can help with being able to cut and run when the time is right. Investors will often try to convince themselves that the research was correct and the stock will bounce back, but this can lead to extended losses and future portfolio disaster. Sometimes markets or individual stocks will move in a direction that nobody expected. Being able to take a punch and move on is what may keep investors from experiencing quick defeat in the stock market.

Turning to some additional indicators on the charts, CME Group Inc (CME) currently has a 50-day Moving Average of 208.48, the 200-day Moving Average is 188.48, and the 7-day is noted at 215.24. Following moving averages with different time frames may help offer a wide variety of stock information. A longer average like the 200-day may serve as a smoothing tool when striving to evaluate longer term trends. On the flip side, a shorter MA like the 50-day may help with identifying shorter term trading signals. Moving averages may also function well as a tool for determining support and resistance levels.

Traders may be relying in part on technical stock analysis. CME Group Inc (CME) currently has a 14-day Commodity Channel Index (CCI) of -213.30. Despite the name, CCI can be used on other investment tools such as stocks. The CCI was designed to typically stay within the reading of -100 to +100. Traders may use the indicator to determine stock trends or to identify overbought/oversold conditions. A CCI reading above +100 would imply that the stock is overbought and possibly ready for a correction. On the other hand, a reading of -100 would imply that the stock is oversold and possibly set for a rally.

At the time of writing, the 14-day ADX for CME Group Inc (CME) is 25.98. Many technical chart analysts believe that an ADX value over 25 would suggest a strong trend. A reading under 20 would indicate no trend, and a reading from 20-25 would suggest that there is no clear trend signal. The ADX is typically plotted along with two other directional movement indicator lines, the Plus Directional Indicator (+DI) and Minus Directional Indicator (-DI). Some analysts believe that the ADX is one of the best trend strength indicators available.

The Relative Strength Index (RSI) is one of multiple popular technical indicators created by J. Welles Wilder. Wilder introduced RSI in his book “New Concepts in Technical Trading Systems” which was published in 1978. RSI measures the magnitude and velocity of directional price movements. The data is represented graphically by fluctuating between a value of 0 and 100. The indicator is computed by using the average losses and gains of a stock over a certain time period. RSI can be used to help spot overbought or oversold conditions. An RSI reading over 70 would be considered overbought, and a reading under 30 would indicate oversold conditions. A level of 50 would indicate neutral market momentum. The 14-day RSI is currently sitting at 37.02, the 7-day is at 23.54, and the 3-day is spotted at 8.65.

There are various types of investment philosophies that investors may choose to follow when approaching the stock market. Value investing involves searching for undervalued or bargain stocks that may eventually offer solid returns. Growth investors often buy companies that have highly promising growth potential. Some investors will choose to invest with a contrarian approach. This entails making investment decisions that are opposite of what the majority are doing, such as buying when everyone else is selling and vice-versa. Socially responsible investors may be searching for companies that subscribe to a high level of ethical or moral standards.

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3 Fallen Angel Stocks to Buy Before They Fly Again

For the last few days the stock markets have been healthy. Sentiment has taken a turn to positive and it’s like nothing bad is ever going to happen …

For the last few days the stock markets have been healthy. Sentiment has taken a turn to positive and it’s like nothing bad is ever going to happen again. Just yesterday the indices rallied through incredible levels especially in small cap stocks. So there’s no doubt that there are stocks to buy here.

Today we discuss three high-profile stocks to buy: Visa (NYSE:V), Amazon (NASDAQ:AMZN), and Microsoft (NASDAQ:MSFT). These are fallen angels stocks because they have recently corrected off of their highs just when they looked like their rallies would never end.

The time frames differ among them, but the concept remains the same. They were headed to the moon, then they tripped. So now the opportunity is to pick the right level to buy these stocks. All three management teams are impeccable and they rarely falter on their own. So the bullish thesis for all three AMZN, MSFT and V assumes that markets in general are not going to crash any time soon.

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Microsoft (MSFT)

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It’s hard to call MSFT stock a fallen angel stock because it’s still up 34% year-to-date and it’s only 5% off of the highs. Nevertheless, it has had a tough time in the last trading week, and what makes it interesting is that it did this while the equity markets were rallying hard.

Normally, this raises an alarm and causes me to look into weaknesses which would bring sustained selling. But that’s not the case here. This is a proven company who is merely having a normal price action give-and-take inside a very healthy ascending trend.

Fundamentally MSFT is not cheap since it sells at 29 trailing price-to-earnings ratio and 8 times sales. But this is a company that deserves the benefit of the doubt so it is possible that they deliver strong growth to justify the higher valuations.

This is all to say that Microsoft stock is not cheap but it still is a good one to own for the long term. So these dips are normal and should not cause a panic out of the stock.

Technically, the zone around $130 per share is pivotal for MSFT stock. This was resistance in April, then a break out in June, and then a successful test for support in early August when markets fell in fear of the 10% additional tariffs tweet. So clearly the bulls earned the right to use it that support.

Knowing this, makes it possible for the buy-programs to prevail over the bears in the battle over MSFT for as long as the equity markets are healthy. If I own shares, I don’t panic out of them on these dips. Moreover, if I want to own some for the future then this is as good a time as any to start a position there.

Alternatively I can use options to sell puts or spreads below said support to generate income without needing rallies. For this, it is important to note that if stocks correct this year from geopolitical risk, then Microsoft stock is vulnerable to a 12% correction.

Visa (V)

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V stock is in a similar situation to that of Microsoft. It’s a proven winner that was seemingly rallying to the moon without interruption. But then in the last few days, it fell 6% while the general markets are up big.

Here too, the drop is not a reflection on Visa itself but rather part of normal price action. For the longest time credit card stocks with a presence in the fintech space like Visa and MasterCard (NYSE:MA) have been darlings because the investment dollars allotted to bet on financials shied away from buying money-center banks like Bank of America (NYSE:BAC) and JPMorgan (NYSE:JPM). Instead they piled into fintech.

However the recent rally in yields caused a frenzied wave of buying the traditional banks and money has to come from the same bucket. So there is a rotation out of winners like V stock into laggards. The opportunity here is that rotations are usually temporary. Meaning the dip in Visa stock should be a buying opportunity.

Just like Microsoft, Visa is not cheap. It sells at 35 trailing P/E and 18 times its sales. But this alone is not cause for alarm because that’s how it’s always been. So unless the bears have developed sudden incredible fortitude, I bet that the selling will abate soon.

Technically, Visa stock should have support around $172 per share. Moreover there is bigger support from pivotal zones at $165 per share. So if I owned shares I don’t panic yet. If seeking a long entry with room to spare, I like to sell puts into support zones on bad days to generate income as long as I can gauge the risk.

Visa stock is 7% off its highs, so if I sell a put in V stock at $160 per share I would own it after a 15% correction. This is a risk I can tolerate and I bet would be a fruitful one. I should know that there is short-term risk looming. if Visa falls below $183.75, it could invite sellers to $168 per share.

Amazon (AMZN)

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I cannot write about potential upside of fallen angels stocks without including the biggest momentum story of all time. AMZN stock is one that has been in the news for decades. It draws critics and fans in droves and is subject to many a heated debate.

After the May correction, Amazon stock made a nice recovery but it gave almost all of it back. And it now sits 10% lower than the July highs. The size of the moves in Amazon stock should never surprise investors. This is the mother of all momentum stocks and when it moves, it does it fast and long. So it is best to wait for confirmation of breakouts in either direction before trading it.

Short term, Amazon stock rallies if above $1,853 per share, and could even recover what they lost since July. There will be resistance points along the way so it won’t be easy. Conversely, if it falls below recent support near $1,740 then they could extend the correction down to $1,600 per share.

In essence, the battle is between completing an ABC technical move lower or establishing a base for a rebound rally to breakout from the necklines above. Meanwhile, the AMZN stock is ping-ponging inside a tight range and I should chase the break out of either sides. I personally favor the upside potential for as long as the markets in general are healthy.

For those thinking of turning this into an investment, Amazon is a safe bet in the long run in spite of its high valuation. It sells at 75 trailing P/E but only 3.4 x sales. So as long as they are delivering growth, a high P/E is a prerequisite. You have to spend a lot in order to grow a lot.

We still have the same geopolitical risks we had when we first started this correction. So we are one headline away from rekindled panics. This is all to say that traders shouldn’t take giant positions all at once with great conviction because we have are still hostage to headlines. The best homework can be obliterated short-term by silly headlines. So I don’t risk what I cannot afford to lose.

Nicolas Chahine is the managing director of SellSpreads.com. As of this writing, he did not hold a position in any of the aforementioned securities. Join his live chat room for free here.

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