Four Momentum Stocks That Have Outperformed Apple

NEW YORK (TheStreet) -- Momentum stocks have been strong since earnings and continue to be led by Tesla (TSLA) , which is up 13% since my post-earnings report on Aug. 7.

Apple (AAPL)  , Netflix (NFLX)  and Tesla have each set all-time intraday highs since that post.

Amazon (AMZN) , which broke below its 200-day simple moving average at $349.51 on July 25, traded as low as $304.59 on Aug. 1, and rebounded to a test of its 200-day SMA, which is now at $347.52, on Sept. 4.

Rounding out the field of five momentum stocks is Google (GOOGL)  , which is up 4.7% since Aug. 6, topping Apple's gain of 3.6%.

Here are the updated profiles followed by the latest "Crunching the Numbers" tables.

Apple ($98.36) traded as low as $93.28 on Aug. 8, holding its 50-day simple moving average, which is now up to $97.07. The stock is the only one in today's first "crunching the numbers" table below its 21-day SMA at $99.46. When the stock set its all-time intraday high at $103.74 on Sept. 2, investors had the opportunity to book profits on strength to a semiannual risky level at $102.39.

The weekly chart still has momentum characteristics as the chart is positive but overbought with the five-week modified moving average at $97.71. Apple needs to end the week above $97.71 to stay positive. Monthly and semiannual value levels are $95.85 and $95.32, respectively, with weekly and semiannual risky levels at $100.94 and $102.39, respectively.

Amazon($342.34) set its all-time intraday high at $408.06 on Jan. 22, and traded as low as $284.38 on May 9. Since then, the 200-day SMA has been a magnet at $347.52, and so has an annual pivot at $334.95, which has been crossed several times since March 27.

The weekly chart is positive with its five-week MMA at $335.20 and its 200-week SMA at $255.56. Weekly and monthly value levels are $321.28 and $267.26, respectively, with the annual pivot at $334.95, a semiannual pivot at $344.36 (not in the second table) and quarterly and semiannual risky levels at $385.43 and $419.21.

Google ($601.63) set its all-time intraday high at $615.04 on Feb. 26, and traded as low as $511 on April 28, which was just below its 200-day SMA, then at $517.20. A subsequent high was set at $608.91 on July 24, with the 200-day SMA, now at $568.98. The stock is challenging these highs this week.

The weekly chart is positive with its five-week MMA at $589.23. Semiannual and monthly value levels are $589.86 and $589.40, respectively, with a weekly pivot at $593.11 and a quarterly risky level at $657.12.

Netflix ($479.33) has been above its 200-day SMA since May 19 with the average now at $401.15. The stock set an all-time intraday high at $487.60 on Sept. 3.

The weekly chart is positive but overbought with its five-week MMA at $461.11. Quarterly and monthly value levels are $472.26 and $465.86, respectively, above semiannual value levels at $359.04 and $341.57. A weekly pivot is $472.16 and no risky levels. Investors who booked profits on strength to $472.26 on July 2 could have bought the stock to its 50-day SMA at $426.09 on July 24.

Tesla Motors ($282.11) has been a leading momentum stock since trading near a test of its 200-day SMA at $176.40 on May 9, when the low was $177.22. The stock set its all-time intraday high at $291.42 on Sept.4. This high was just above the August risky level at $283.76, giving investors the option to book profits.

The weekly chart is positive but overbought with its five-week MMA at $257.62. A quarterly value level is $227.65 with a weekly pivot at $285.93 and monthly risky level at $297.42.

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.

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.

Follow @Suttmeier

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

 


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."

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