Apple, Intel, Microsoft, Netflix, Tesla Can Lead the Nasdaq Back Above 5000

NEW YORK (TheStreet) -- The Nasdaq is up 9.4% year to date outperforming the S&P 500 which is up 8.2%. Strength towards the 5000 milestone for the Nasdaq is being led by five stocks, two of which were not publicly traded when the Nasdaq last went above the 5000 level, 5132, in March 2000.

Here's my analysis of the weekly chart for the Nasdaq, which will be followed by profiles and two "crunching the numbers" tables for Apple (AAPL) , Intel (INTC) , Microsoft (MSFT) , Netflix (NFLX) and Tesla (TSLA) .

Courtesy of MetaStock Xenith

The weekly chart for the Nasdaq (4570) is positive but overbought with its five-week modified moving average at 4449 and its 200-week simple moving average at 3252. The 12x3x3 weekly slow stochastic is 88.05, well above the overbought threshold at 80.00.

Read More: Warren Buffett's Top 10 Dividend Stocks

At the upper left of the chart is the top of the Nasdaq bubble that peaked at 5132 in March 2000. The post-bubble low was 1136 in October 2002, down 78%. The Nasdaq would have to rise another 12% to reach the March 2000 high.

I show semiannual and annual value levels at 3972 and 3471 with a quarterly pivot at 4569, which was tested at the multi-year high at 2079.53 set on Aug. 27. A semiannual risky level is 4642.

Here are the six Nasdaq stocks that could power this 12% gain.

Apple ($102.13) is up 27% year to date and its weekly chart is positive but overbought with its five-week modified moving average at $93.67. Apple traded to an all-time intraday high at $102.57 on August 27. Would you believe that Apple traded around $5.00 during the 1999 / 2000 tech bubble? Apple traded above its semiannual pivot at $102.39 on Wednesday. A semiannual value level is $95.32.

Intel ($34.79) is up 34% year to date and its weekly chart is positive but overbought with its five-week MMA at $33.22. Intel traded above $72.00 back in March 2000 so it has not yet fully recovered. A semiannual value level is $29.79.

Microsoft ($44.87) is up 20% year to date and its weekly chart is positive with its five-week MMA at $43.79. Microsoft traded above $57.00 back in March 2000. A semiannual value level is $41.67.

Netflix ($474.70) is up 29% year to date and set an all-time intraday high at $485.30 on August 24. The weekly chart is positive but overbought with its five-week MMA at $428.17. Netflix was not publicly traded in March 2000. A semiannual value level is $359.04 with a quarterly pivot at $472.26.

Tesla ($263.25) is up 75% year to date and its weekly chart is positive but overbought with its five-week MMA at $243.73. Tesla set an all-time intraday high at $267.26 on August 18. Tesla was not publicly traded in March 2000. A quarterly value level is $227.65 with a monthly risky level at $283.78.

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.

Read More: RadioShack Weighs Options Including Refinancing, Bankruptcy

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 are listed in red.

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 date the company reported EPS, the beat or miss of analysts estimates and the reported earnings per share, and where to buy on weakness and where to sell on strength.

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.

Read More: How Watson Can Spark a Data-Driven R&D Revolution

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.

Follow @Suttmeier

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.


TheStreet Ratings team rates APPLE INC as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:

"We rate APPLE INC (AAPL) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, expanding profit margins and solid stock price performance. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."

You can view the full analysis from the report here: AAPL Ratings Report

If you liked this article you might like

Warren Buffett Is Never Going to Be the Dumbest Person on Wall Street

Warren Buffett Is Never Going to Be the Dumbest Person on Wall Street

What to Watch From Samsung, Google and Others at the Mobile World Congress

What to Watch From Samsung, Google and Others at the Mobile World Congress

Warren Buffett Is Sticking to His Strengths By Selling IBM and Buying More Apple

Warren Buffett Is Sticking to His Strengths By Selling IBM and Buying More Apple

Buffett Letter to Shareholders May Detail How He Intends to Spend $109 Billion

Buffett Letter to Shareholders May Detail How He Intends to Spend $109 Billion

General Mills Buying a Natural Pet Food Company for $8 Billion Makes Sense

General Mills Buying a Natural Pet Food Company for $8 Billion Makes Sense