How Nine Tech Stocks Show Everything Old Is New Again

NEW YORK (TheStreet) -- Old technology companies are in vogue again as momentum returns to the nine stocks profiled today. Each has gained between 10% and 40% year to date and between 19% and 66% during the last 12 months.

What prompted my attention was Intel ( INTC) raising its earnings esimates after the closing bell on Thursday. Overly simplified, Intel expects increased demand for business PCs.

On April 7 I wrote, Will Investors Support Microsoft After It Ends Windows XP Support?. The answer is yes as businesses migrate away from Windows XP. Microsoft (MSFT) recommends that companies shift to Windows 8.1. That means demand for new PCs as older computers will not run under Windows 8.1.

As a lyric from the Peter Allen and Carole Bayer Sager song goes, "We'll order now, what we ordered then, cause "Everything Old is New Again."

All nine stocks are above their five key moving averages with either rising or overbought 12x3x3 weekly slow stochastics, which makes all weekly chart profiles positive. This is the characteristics of all momentum stocks.

Apple (AAPL) ($91.28) traded at its 2014 intraday high at $95.05 last Tuesday with a monthly value level at $90.23 and a semiannual risky level at $95.32.

Adobe Systems (ADBE) ($66.82) is an important stock to watch this week as the company reports quarterly results after the closing bell on Tuesday. Analysts expect the company to report earnings per share of 16 cents.

Weekly and semiannual value levels are $63.53 and $62.44, respectively, with quarterly and monthly risky levels at $72.23 and $72.53, respectively. A new computer may require the purchase of new Adobe software.

Applied Materials (AMAT) ($22.37) set a multiyear intraday high at $22.41 on Friday on the prospect of increased demand for semiconductor fabrication equipment. We show weekly and monthly value levels at $21.67 and $20.96, respectively, with a quarterly pivot at $22.07.

Hewlett-Packard (HPQ) ($35.16) set a multiyear intraday high at $35.20 on Friday as the former Dow component continues its turnaround story on the prospect of increased demand for PCs. Weekly and quarterly value levels are $34.03 and $30.97, respectively, with monthly and annual risky levels at $37.91 and $40.20.

Intel ($29.87) gapped higher on Friday on its projections for increased PC demand, as it set a multiyear intraday high at $30.06. Monthly and weekly value levels are 28.06 and $27.10, respectively, with a semiannual pivot at $29.91, tested at Friday's high.

Microsoft ($41.23) set a multiyear intraday high at $41.66 on June 6, and the company is likely seeing demand for Windows 8.1. Weekly and quarterly value levels are $40.91 and $39.45, respectively, with a semiannual pivot at $41.67 and monthly risky level at $43.98.

Oracle (ORCL) ($42.14) is another important stock to watch this week as the company reports quarterly results after the closing bell on Thursday. Analysts expect the company to report earnings per share of 92 cents. Semiannual and annual value levels are $38.85 and $34.92, respectively, with an annual pivot at $42.23 and weekly and monthly risky levels at $43.28 and $46.24, respectively.

SanDisk (SNDK) ($98.47) set an all-time intraday high at $100.81 on June 11. The stock is the biggest year-to-date winner and the biggest winner during the last 12 months. Monthly and semiannual value levels are $94.91 and $79.01, respectively, with a weekly risky level at $102.74.

Texas Instruments (TXN) ($48.33) has weekly and semiannual value levels at $47.65 and $41.08, respectively, with a monthly pivot at $49.08 and semiannual and quarterly risky levels at $49.32 and $50.54, respectively.

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.

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

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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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