Tesla, Netflix, Apple Win Trifecta in Momentum Stock Race

NEW YORK (TheStreet) -- Momentum stocks fell hard early in the year, but have been trending up during the past few weeks. Today I look at five momentum stocks that I profiled on May 13 and crunch the numbers again to see if and when you should invest.

Since my article in May, Netflix (NFLX) has gained the most, followed by Tesla (TSLA) and Apple (AAPL), to form a trifecta of high-profile growth stocks.

Apple ($628.65) is up 6% since May 12, setting a multiyear intraday high at $644.17 on May 30. The stock faded on Monday after the company didn't announce any new consumer products at the opening of its Worldwide Developers Conference. Apple is above all five key moving averages in today's first table.

The weekly chart is positive but overbought with the five-week modified moving average at $594.36. Annual value levels are $586.06 and $517.05 with weekly and monthly risky levels at $639.78 and $647.58 with the high in-between these levels.

Amazon  (AMZN) ($308.84) is up just 2% since May 12 after setting a 2014 low at $284.38 on May 9. The stock has been below its 200-day SMA at $342.99 since April 3.

The weekly chart shifts to positive given a close this week above its five-week MMA at $313.88. Weekly and annual value levels are $293.84 and $259.67, respectively, with annual and semiannual risky levels at $334.95 and $351.24, respectively.

Google  (GOOGL) ($564.34) is up 4.8% since May 12 after setting a 2014 intraday low at $511 on April 28, and going as high as $577.66 on May 28. The stock has faded in recent trading days. At the low, the stock was trading back and forth around its 200-day SMA now at $528.42. The stock is above all five key moving averages.

The weekly chart is positive with its five-week MMA at $554.27. A weekly value level is $542.22 with annual value levels are $522.17 and $489.53. A quarterly pivot at $562.40 with a monthly risky level at $611.62.

Netflix ($422.06) is up 22% since May 12 to win this leg of the momentum race. Netflix traded as low as $299.50 on April 28, and went as high as $422.91 on June 2. After being below its 200-day SMA at its low, the stock is now above this key moving average at $354.83. The stock is above all five key moving averages.

The weekly chart is positive with its five-week MMA at $382.62. Weekly and quarterly value levels lag at $385.27 and $328.81, respectively, with this month's risky level at $451.04.

Tesla ($204.70) is up 11% since May 12, finishing in second place in the momentum race. The stock traded as low as $177.22 on May 9, holding its 200-day SMA now at $180.93.

The weekly chart is positive with its five-week MMA at $203.27. Weekly and quarterly value levels at $189.85 and $185.07, respectively. The stock has not been publicly traded long enough to have semiannual and annual levels.

Your investment policy among these stocks depends on whether or not you are a buyer on weakness or a seller of strength. We advocate using a good-'til-cancelled limit order to buy weakness to a value level or to sell strength to a risky level.

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.

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.

Crunching the Numbers with Richard Suttmeier: Earnings & Where to Buy & Where to Sell

This table presents the levels at which 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.

>>Read More: Homebuilder Hovnanian, 4 Others That Are Reporting Face More Volatility

>>Read More: 3 Big-Volume Stocks in Breakout Territory

>>Read More: Broadcom's a Buy Now That It's Cutting Ties to Wireless

At the time of publication, the author held no positions in any of the stocks mentioned.

Follow @Suttmeier

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff

Richard Suttmeier is the chief market strategist at ValuEngine.com. He has been a professional in the U.S. Capital Markets since 1972, transferring his engineering skills to the trading and investment world.

Suttmeier has an engineering degree from Georgia Tech and a Master of Science degree from Brooklyn Poly. He began his career in the financial services industry in 1972 trading U.S. Treasury securities in the primary dealer community. He became the first long bond trader for Bache in 1978, and formed the Government Bond Department at LF Rothschild in 1981, helping establish that firm as a primary dealer in 1986. This experience gives him the insights to be an expert on monetary policy, which he features in his newsletters, and market commentary.

Suttmeier's industry licenses include, Series 7 and Registered Principal (Series 24). He has been the Chief Market Strategist for ValuEngine.com since 2008 and often appears on financial TV.

Click here for details on Suttmeier's "Buy and Trade" investment strategy.

Richard Suttmeier can be reached at RSuttmeier@Gmail.com

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