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Nasdaq 100 Trust
completed a round trip back to its 2007 high last week. It's a relief the instrument finally overcame multiple layers of resistance generated by the Feb. 27 selloff.
But its primary components -- big tech stocks -- still have a lot of work to do in order to catch up with the mid-cap and small-cap segments of the broad sector.
Perhaps this will change as the first-quarter earnings season unfolds. After all, big-caps in other market groups have been firing on all cylinders this April, leading the
to new yearly highs.
But it's still a wait-and-see game for big tech, which has disappointed patient investors for several quarters now.
In the meantime, let's look at one of the most promising plays in the big-tech arena (see chart below).
Apple is the obvious place to start because its leadership role in big tech has been unrivaled in recent years.
I've seen a fair share of hand-wringing lately as the stock's latest upsurge fizzled out. But all systems are still go for the issue to break out to a new multiyear high in the next one to two months.
The stock sold off in early April after it filled the sharp January down gap between $92 and $95. This is common behavior the first time that a recovering issue rises into this type of overhead supply. The pullback and bounce at the 50-day moving average suggest that price is working through a triangle pattern that should hold support just under $90.
to see more of Alan's big-tech charts.
At the time of publication, Farley had no positions in the stocks mentioned, although holdings can change at any time.
Alan Farley is a professional trader and author of
The Master Swing Trader
. Farley also runs a Web site called HardRightEdge.com, an online resource for trading education, technical analysis and short-term investment strategies. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Farley appreciates your feedback;
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