Weekly Technical Analysis for 12 to 16 April

I’ll try to figure out how to zoom the images in the following days, sorry for that…

NASDAQ 100

We’ve recovered most of the Feb/March losses, but the Tech Heavy NSQD100 is still far behind DJ30 and SPX500, as these two keep hitting new ATH.

Recovery and cyclical trends are still in play on a macro level, high-flyers COVID-19 winners are far away from their ATH, and Innovation heavy ETFs, like ARK are still lagging behind, for multiple reasons.

We are hitting a key level of $13917, an ATH for NASDQ but momentum is on our side! Let’s look at some indicators

  • we’ve had a Golden Cross on the start of last week, with EMA14 crossing EMA 21&50
  • RSI is still between 60-70, positive momentum but not overbought, we are taking our time going the way up
  • BB flat on the bottom, still no clear sign of contraction
  • MACD still very bullish, hitting those 200 levels

Conclusion

I’m expecting we keep climbing during this week, but let’s keep an eye on RSI and MACD for overbought signals.

Conservative trader

A conservative trader would not make any positions before we have a clear breakout on $13917 level – having an entire green candle over that level.

Akamai

  • Clear upwards trendline
  • Very close to a Golden Cross EMA50 & EMA200
  • Crossing EMA200
  • RSI 55, over 50 giving a bullish signal, still far from overbought

We have a very good setup on the name, opening a new position

Risk Reward 2 – Risking 3.88% to Gain 7.81%

AMD

  • Broke downward trendline
  • Recently touched EMA200
  • Golden Cross EMA14&21
  • Bullish Divergence

We have a very good setup on the name, opening a new position

Risk Reward 2 – Risking 8.67% to Gain 17.34%

JD

  • No clear break in the downtrend
  • No clear break in moving averages
  • Getting support on EMA200
  • RSI ~40, still giving a bearish signal

We still have no clear signal on the name, but we are very close to a BUY signal

Keeping under scope for possible entry during week

Mongo DB

  • Broke downtrend
  • EMAs reverting
  • Getting support EMA200
  • RSI rising, about to cross 50 level
  • Bullish divergence!

We have an interesting setup with the break of the trendline and a clear bullish divergence that gives us confidence in going long.

Risk Reward 2 – Risking 11.35% to Gain 22.71%

Lululemon

  • Broke downtrend
  • EMAs reverting
  • Crossing EMA200
  • RSI rising, just broke 50 level

Another interesting setup as the stock tends to rise far from EMA200.

Risk Reward 2 – Risking 7.27% to Gain 14.53%

Moderna

  • Broke downtrend (not drawn)
  • EMAs reverting
  • RSI rising, crossing 50 level
  • Bullish divergence!

We have an interesting setup with the break of the trendline and a clear bullish divergence that gives us confidence in going long.

Risk Reward 2 – Risking 9.65% to Gain 19.22%

Overstock

  • Broke downtrend
  • EMAs reverting
  • Taking support on EMA200
  • RSI rising, crossing 50 level

We have an interesting setup with the break of the trendline that gives us confidence in going long.

Risk Reward 2 – Risking 13.65% to Gain 27.30%

Qualcomm

  • Broke downtrend – over a week ago
  • Golden Cross EMA14&21
  • Took support on EMA200
  • RSI rising, above 50, far from overbought

We have an interesting setup on such a beatdown name, with the break of the trendline that gives us confidence in going long.

Risk Reward 2 – Risking 8.39% to Gain 16.79%

Some indicators used

EMAX – Exponential Moving Average, tracks the average of the price on the last X sessions

BBX – Bollinger Band, looks back X steps, uses standard deviation to determine  oversold and overbought, change of trends and breakouts

MACD – Moving Average Convergence Divergence uses EMA to determine current trend strength and trend reversals

RSI – Relative Strength Index is a momentum indicator to determine oversold and overbought price action, current trend, and very important, to detect divergences.

 

Some strategies used

Divergence – Price action going against RSI indicator movements

Mean Reversion – Expecting price to move back to the mean, typically EMA200

Trendlines – Determine trendlines and trade accordingly

Resistance & Support – Determine key levels and trade accordingly