NASDAQ Composite (.IXIC) chip stocks hit by weak forecasts
The Nasdaq Composite index fell about 2.5 percent on Monday, hit by a slump in Apple Inc shares after two suppliers cut their forecasts, sparking a selloff in other iPhone component makers and weighing on technology stocks.
Apple shares fell 4.4 percent to $195.40, their lowest since July 27, after Lumentum Holdings Inc, the main supplier for Face ID technology, and screen maker Japan Display Inc cut their forecasts.
The technology sector, which has fueled much of the U.S. stock market’s bull run, fell 3.2 percent, while the Philadelphia SE Semiconductor index dropped 4.1 percent.
“These are growth stocks, any little bit of growth that goes away from the company, makes the company less desirable,” said Kim Forrest, senior portfolio manager at Fort Pitt Capital Group in Pittsburgh.
“I don’t think this necessarily means that tech is being rejected by consumers, we may have expected too much in the way of new phone sales in the short-run.”
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 7,630.92.
The projected upper bound is: 7,518.65.
The projected lower bound is: 6,846.74.
The projected closing price is: 7,182.70.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 20 white candles and 30 black candles for a net of 10 black candles.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 42.7457. This is not an overbought or oversold reading. The last signal was a sell 1 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 40.76. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 12 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -35. This is not a topping or bottoming area. The last signal was a sell 1 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 7 period(s) ago.
Rex Takasugi – TD Profile
NASDAQ COMPOSITE closed down -206.033 at 7,200.869. Volume was 9% above average (neutral) and Bollinger Bands were 35% wider than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 7,367.28 7,680.22 7,518.18
Volatility: 32 29 23
Volume: 640,168,192 618,967,168 544,798,336
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
NASDAQ COMPOSITE is currently 4.2% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of .IXIC at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .IXIC and have had this outlook for the last 27 periods.