
How to Trade FANG Stocks as Netflix Reports Earnings -- Plus Jim Cramer's Take
The FANG stocks, as TheStreet's Jim Cramer dubs them, include Facebook (FB) - Get Report , Amazon (AMZN) - Get Report , Netflix (NFLX) - Get Report and Google's parent company Alphabet (GOOGL) - Get Report . These tech-centric companies are set to report their first-quarter earnings beginning next week, just as they regain technical momentum. Here are the daily and weekly charts and trading guidelines. Both Facebook and Google are holdings in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio.
These charts show significant volatility following earnings reports. Charts and key levels provide guidelines to navigate earnings reactions.
Netflix has the largest gain off its 2016 low among the four FANG stocks. Netflix, while down 3.5% year to date, is up 38.1% since trading as low as $79.95 on Feb. 8. Analysts expect the streaming media company to earn 3 cents a share when it reports quarterly results after the closing bell on Monday.
Alphabet is the second to report earnings, which are is scheduled to be released after the closing bell on April 21. Analysts expect this tech giant to earn $6.37 a share. Alphabet has a gain of 13.7% since setting its 2016 low of $682.01 on Feb. 8.
Jim Cramer and Research Director Jack Mohr told Action Alerts PLUS subscribers in their weekly roundup, "We reiterate our $900 long-term price target" on Alphabet stock.
Alphabet stock moved to the No. 2 spot in the latest Growth Index rankings, updated on Thursday's Action Alerts PLUS members-only conference call.
"We believe the market is discounting its seven-pronged growth drivers (seven businesses boast over 1 billion users) along with the fact that its double digit earnings and growth algorithm is accompanied by high free cash flow generation and operational discipline," said Mohr and Cramer on Friday.
Facebook earnings will be released after the closing bell on April 27. Analysts expected the benchmark social media giant to earn 44 cents a share. Facebook was the first to bottom and is up 24% from its Jan. 20 low of $89.37.
"Its incredible growth story cannot be ignored," commented Cramer and Mohr on Facebook. They recommend buying the stock on a post-earnings pullback.
Facebook is the No. 1 stock in the Action Alerts PLUS Growth Index. "We like Facebook for its 1.5 billion users and combination of top-line and bottom-line growth in the tune of 40% and 30%, respectively," Mohr and Cramer wrote Friday.
Alphabet and Facebook are holdings in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells GOOGL or FB? Learn more now.
On-line retailer Amazon reports quarterly results after the closing bell on April 28. Analysts expect the company to earn 59 cents a share. Amazon has the weakest year-to-date performance, with a decline of 8.2%, but it is up a significant 31% since its 2016 low of $474.00, set on Feb. 9.
FANG stocks are known for their upside momentum leadership when the stock market is in rally mode. But when markets experience significant downside, shares of FANG stocks can become extremely volatile. That's why investors need to look at daily and weekly charts and know the key levels at which to buy on weakness or sell on strength.
Here's the FANG scorecard.
Here's the daily chart for Amazon.
Courtesy of MetaStock Xenith
Amazon closed Thursday at $620.75, down 8.2% year to date and up 31% above the Feb. 9 low of $474.00.
The horizontal lines are the Fibonacci Retracements of the decline from the all-time high of $696.44, set on Dec. 29 and the 2016 low. Amazon held its 50% retracement of $585.21 on April 5 and closed above its 61.8% retracement of $611.59 on Wednesday and Thursday, but remains well below a huge price gap from the Dec. 31 low of $675.89.
Here's the weekly chart for Amazon.
Courtesy of MetaStock Xenith
The weekly chart is positive, with the stock above its key weekly moving average of $586.71 and well above the 200-week simple moving average of $368.03 The weekly momentum reading is projected to rise to 61.98 this week, up from 53.16 on April 8.
Investors looking to buy Amazon should consider doing so on weakness to $589.38, $583.37 and $540.85, which are key levels on technical charts until the end of June and for all of 2016, respectively.
Investors looking to reduce holdings should consider doing so on strength to $645.67, which is a key level on technical charts until the end of April.
Here's the daily chart for Facebook.
Courtesy of MetaStock Xenith
Facebook closed Thursday at $110.84, up 5.9% year to date and up 24% above the Jan. 20 low of $89.37.
This chart shows the Fibonacci Retracements of the rally from the Jan. 20 low of $89.37 to the all-time high of $117.59, set on Feb. 2. The 38.2% retracement of $106.81 held at the low on April 13, then popped above its 23.6% retracement of $110.93 on April 14.
Here's the weekly chart for Facebook.
Courtesy of MetaStock Xenith
The weekly chart is positive, with the stock above its key weekly moving average of $110.11 and well above the 200-week simple moving average of $61.96. The weekly momentum reading is projected to rise to 78.67 this week, up from 77.84 on April 8, and will likely be overbought when the company reports earnings on April 27.
Investors looking to buy Facebook should consider buying weakness to $81.91, which is a key level on technical charts until the end of 2016.
Investors looking to reduce holdings should consider selling strength to $114.33 and $120.89, which are key levels on technical charts until the end of April and June, respectively.
Here's the daily chart for Alphabet.
Courtesy of MetaStock Xenith
Alphabet closed Thursday at $775.39, down 0.3% year to date. It is 13.7% above the Feb. 8 low of $682.01.
This chart shows the Fibonacci Retracement from the all-time high of $810.35 set on Feb. 2 and the Feb. 8 low of $682.01. The stock has been above its 50% retracement of $746.28 since March 14, then traded around its 61.8% retracement of $761.42 between March 17 and April 12, and is now above this level.
Here's the weekly chart for Alphabet.
Courtesy of MetaStock Xenith
The weekly chart is positive, with the stock above its key weekly moving average of $754.26 and well above the 200-week simple moving average of $529.96. The weekly momentum reading is projected to rise to 58.35 this week, up from 53.96 on April 8.
Investors looking to buy Alphabet should consider doing so on weakness to $717.91, which is a key level on technical charts until the end of June.
Investors looking to reduce holdings should consider selling strength to $802.24 and $807.64, which are key levels on technical charts until the end of April and June, respectively.
Here's the daily chart for Netflix.
Courtesy of MetaStock Xenith
Netflix closed Thursday at $110.42, down 3.5% year to date. It is 38.1% above the Feb. 8 low of $79.95.
The horizontal lines are the Fibonacci Retracements of the decline from the all-time high of $133.27, set on Dec. 7, and the Feb. 8 low of $79.95. The rally off the low reached the 50% retracement of $106.62 on April 12, which is also above the 200-day simple moving average of $106.62. The 61.8% retracement of $112.94 is the next upside target.
Here's the weekly chart for Netflix.
Courtesy of MetaStock Xenith
The weekly chart is positive, with the stock above its key weekly moving average of $102.59 and well above the 200-week simple moving average of $57.26. The weekly momentum reading is projected to rise to 60.23 this week, up from 49.80 on April 8.
Investors looking to buy Netflix should consider doing so on weakness to $97.71 and $82.98, which are key level on technical charts until the end of April and the end of 2016, respectively.
Investors looking to reduce holdings should consider selling strength to $116.75, which is a key level on technical charts until the end of June.
The $108.23 level is in play until the end of June.
This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.


















