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Stocks Are Still Overbought, but Signal of Top Hasn't Arrived

Here's my up-to-date Market Pulse, which shows the upside potential to semiannual risky levels and the downside risks to annual value levels. For the Dow industrials the upside is 6.9% with 17.7% downside risk.

Here's the scorecard for the stocks that reported earnings results after the bell Thursday. These were previewed on Aug. 6 in, Groupon, Tesla and Priceline Headline Earnings Previews.

Molycorp (MCP - Get Report) ($6.69) missed EPS estimates by 9 cents by reporting a loss of 36 cents a share. The producer of rare earth oxide continues to have a sell rating, according to ValuEngine and closed Thursday at $7.41. The stock traded into the investor woodshed with a low of $6.21 on Friday, but the close was above its 50-day SMA at $6.44. My monthly value level is $4.74 with a weekly risky level at $7.49.
[Read: <a target="blank" data-add-tracking="true" href="http://www.mainstreet.com/slideshow/lifestyle/travel/8-worst-ways-waste-money-road"><em>8 Worst Ways to Waste Money on the Road</em></a>]

NVIDIA (NVDA - Get Report) ($14.49) beat EPS estimates by 3 cents by reporting EPS of 16 cents a share. The maker of 3-D graphics processors has a buy rating and closed Thursday at $14.70. The stock traded as low as $14.11 on Friday but closed above its 50-day SMA at $14.38. My quarterly value level is $11.20 with weekly and monthly pivots at $14.43 and $14.95 and semiannual risky level at $17.21.

Priceline.com (PCLN - Get Report) ($969.89) beat EPS estimates by 5 cents earning $9.05 a share. The online "name your own price" retailer continues to have a buy rating and closed Thursday at $933.75. The stock began Friday with a moon shot to $994.98, which is significantly greater than my semiannual pivot at $935.65. The stock ended the week below a new weekly pivot at $975.31. A buy rating means that the stock will gain at least 5% over the next 12 months. Priceline is projected to gain 8.4% which is a $1,050 price target.

Rackspace Hosting (RAX - Get Report) ($47.85) beat EPS estimates by 3 cents, by reporting EPS of 16 cents a share. The Web-hosting company still has a hold rating and closed Thursday at $44.22. The stock surged to $49.50 on Friday. The stock is trading between its 50-day SMA at $40.37 and its 200-day SMA at $54.96. My monthly value level is $35.36, with weekly and quarterly risky levels at $51.75 and $56.26.

At the time of publication, Suttmeier had no positions in stocks mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.
Richard Suttmeier has an engineering degree from Georgia Tech and a master of science from Brooklyn Poly. He began his career in the financial services industry in 1972 trading U.S. Treasury securities in the primary dealer community. In 1981 he formed the Government Bond Department at LF Rothschild and helped establish that firm as a primary dealer in 1986. Richard began writing market research in 1984 and held positions as market strategist at firms such as Smith Barney, William R Hough, Joseph Stevens, and Rightside Advisors. He joined www.ValuEngine.com in 2008 producing newsletters covering the U.S. capital markets, and a universe of more than 7,000 stocks. Richard employs a "buy and trade" investment strategy and can be reached at RSuttmeier@Gmail.com.
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SYM TRADE IT LAST %CHG
MCP $0.12 6.36%
NVDA $21.75 0.00%
PCLN $1,245.25 0.00%
RAX $30.52 0.00%
AAPL $109.27 0.00%

Markets

Chart of I:DJI
DOW 16,102.38 -272.38 -1.66%
S&P 500 1,921.22 -29.91 -1.53%
NASDAQ 4,683.9190 -49.5780 -1.05%

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