NEW YORK (TheStreet) -- Market volatility so far this year makes the beginning of the first-quarter earnings season difficult to handicap.
That's why investors need the discipline provided by technical analysis and the value levels at which to buy on weakness and the risky levels at which to sell on strength. Our guidance helps investors both before and after a company reports its quarterly financial results.
Today's Crunching the Numbers tables assess the stocks of four companies reporting this week. After the profiles, the first table provides the five major moving averages and stochastic readings. The second table provides earnings estimates, value levels at which to buy on weakness and risky levels at which to sell on strength.
Fastenal (FAST) ($50.84, up 7% year to date): Analysts expect the provider of industrial and construction supplies and tools to report earnings per share of 37 cents before the opening bell on Friday. The stock traded at its 2014 intraday low at $42.48 on Feb. 3, and then rebounded, crossing its 200-day simple moving average at $47.47 on March 5 and trading as high as $52.20 last Friday between annual levels at $49.31 and $56.12.
The weekly chart is positive with its five-week modified moving average at $48.86. A monthly value level is $46.05 with a semiannual pivot at $51.13 and weekly risky level at $52.53.
Family Dollar (FDO) ($58.74, down 9.6% YTD): Analysts expect the discount store chain to report earnings of 91 cents a share before the opening bell tomorrow. The stock has been below its 200-day SMA at $66.91 since Feb. 27, and traded as low as $57.28 on March 27.
The weekly chart is negative but oversold with its five-week MMA at $60.64. The stock has been trading back and forth around its 200-week SMA at $58.23 since March 25. An annual value level is $49.44 with a weekly pivot at $60 and monthly and quarterly risky levels at $62.39 and $63.51.
Pier 1 Imports (PIR) ($18.27, down 20.8% YTD): Analysts expect the retailer of home-furnishing products to report earnings of 40 cents a share before the opening bell tomorrow. The stock broke below its 200-day SMA at $21.16 Jan. 9, following a disappointing fourth-quarter earnings report. The stock traded as low as $17.32 on April 7, which is just above this month's value level at $17.27.
The weekly chart is negative but oversold with its five-week MMA at $18.99. Monthly and annual value levels are $17.27 and $15.10 with a weekly pivot at $18.91 and quarterly and semiannual risky levels at $22.27 and $27.01.
Rite Aid (RAD) ($6.11, up 20.8% YTD): Analysts expect the drugstore chain to report earnings of 5 cents a share before the opening bell tomorrow. The stock set a multiyear intraday high at $7.05 on March 13, and it's now below its 21-day and 50-day SMAs at $6.54 and $6.30 and traded as low as $5.83 on Monday.
The weekly chart is negative with its five-week MMA at $6.27. My quarterly value level is $5.16 with weekly and monthly risky levels at $7.19 and $7.94.
Crunching the Numbers with Richard Suttmeier: Moving Averages & Stochastics
This table provides the technical status for the stocks profiled in today's report.
There are five columns with moving average titles: Five-Week Modified Moving Average, 21-Day Simple Moving Average, 50-Day Simple Moving Average, 200-Day Simple Moving Average and the 200-Week Simple Moving Average.
The column labeled 12x3x3 Weekly Slow Stochastics shows the pattern on each weekly chart with readings from Oversold, Rising, Overbought, Declining or Flat.
Interpretations: (stocks below a moving average listed in red are below that moving average)
Five-Week Modified Moving Average (MMA) is one of two indicators that define whether or not a weekly chart profile is positive, neutral or negative. The other is the status of the 12x3x3 weekly slow stochastic.
A stock with a positive technical rating is above its five-week MMA with rising or overbought stochastics.
A stock with a negative technical rating is below its five-week MMA with declining or oversold stochastics.
A stock with a neutral technical rating has a profile that is not positive or negative.
The 200-Week Simple Moving Average (SMA) is considered a long-term technical support or resistance and as a "reversion to the mean" over a rolling three to five year horizon. (even Apple declined to its 200-week SMA in June 2013)
The 21-Day Simple Moving Average is a short-term technical support or resistance used by many hedge fund traders to adjust positions. A stock above its 21-day SMA will likely move higher over a rolling three to five day horizon and vice versa.
The 50-Day Simple Moving Average is also a technical support or resistance used by many strategists and commentators in financial TV.
The 200-Day Simple Moving Average is another technical support or resistance and I consider this level as a shorter-term "reversion to the mean" over a rolling six to 12 month horizon. (even Apple tested or crossed its 200-day SMA in nine of the last 10 years)
Crunching the Numbers with Richard Suttmeier: Earnings & Where to Buy & Where to Sell
This table presents the EPS estimates including date and before or after the close, and where to buy on weakness and where to sell on strength.
EPS Date is the day the company reports their quarterly results.
EPS Estimate is the earnings per share estimate from Wall Street analysts.
Value Levels, Pivots and Risky Levels are calculated based upon the last nine weekly closes (W), nine monthly closes (M), nine quarterly closes (Q), nine semiannual closes (S) and nine annual closes (A). I have one column for pivots, which is a magnet for the period shown. The columns to the left of the pivots are first and second value levels. The columns to the right of the pivots are first and second risky levels.
Investors who wish to buy a stock should use a good-until-canceled GTC limit order to buy weakness to a value level. Investors who want to sell a stock should use a GTC limit order to sell strength to a risky level.
At the time of publication the author held no positions in any of the stocks mentioned.
This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff