Apple Is America’s Triple Crown Momentum Stock, but Netflix, Amazon Lead the Race

NEW YORK (TheStreet) -- Momentum investing is a lot like Saturday's Belmont Stakes -- a $1.5 million horse race with a clear favorite, the Triple Crown contender American Pharaoh. Investors should consider Apple (AAPL) as the American Pharaoh in the momentum race, as the company is America's Triple Crown stock -- the biggest public company, the fastest horse in the race. Another horse in the Belmont Stakes, Materiality, was the winner of the Florida Derby and resembles Amazon (AMZN) in its status. Amazon delivers almost everything from their fulfillment centers around the country, but it seems to trail Apple in momentum.

Netflix (NFLX), meanwhile, is in the lead of the momentum race by several lengths and is represented by Frosted. Thoroughbred Frosted finished fourth in the Kentucky Derby after being at the back of the pack. This is an indication that this horse can handle the mile-and-a-half track at the Belmont Stakes and perhaps be the upset winner of the Belmont Stakes, keeping Affirmed as the last Triple Crown winner in 1978. And Netflix looks ready to win the momentum race in a similar coup.

Google (GOOGL) is in the unfavorable post position being the momentum stock up the least year to date. Mubtaahij, in the post position in the Belmont Stakes, resembles Google.

Tesla (TSLA) is the long-shot to win the 2015 momentum race; its analogue is Frammento, the thoroughbred least likely to win the Belmont Stakes. This horse finished 11th in the Kentucky Derby, but trainer Nick Zito says he has his horse ready for the length of this race. Both of Zito's Belmont wins were horses trained to go the distance, beating two Triple Crown favorites Smarty Jones in 2004 and Big Brown in 2008. And Tesla may be trailing, but it has a lot going for it.

Here are the weekly charts for the five momentum stocks and the technical handicaps on how to trade them. And they're off!

Here's the weekly chart for Apple.


Courtesy of MetaStock Xenith

Apple had a close of $129.36 on Thursday, up 17% year to date. The stock is above its 50-day and 200-day simple moving averages of $127.80 and $115.62, respectively.

The weekly chart for Apple stays positive if the stock ends the week on Friday above its key weekly moving average of $128.68. The weekly momentum reading is projected to rise to 66.79 this week, up from 65.49 a week ago.

Investors looking to buy Apple should place a good till canceled limit order to purchase the stock if it drops to $110.43, which is a key level on technical charts until the end of 2015.

Investors looking to book profits could have done so using a good till canceled limit order to sell the stock if it rose to $134.41, which was a key level on technical charts until the end of April. This key level was tested at the all-time intraday high of $134.54, set on April 28. Sell strength to this month's key level of $142.15.

Two key levels on technical charts are $122.21 and $126.45, and they remain in play until the end of June.

Here's the weekly chart for Amazon.


Courtesy of MetaStock Xenith

Amazon had a close of $430.78 on Thursday, up 39% year to date, with the stock above its 50-day and 200-day simple moving averages of $408.04 and $349.54, respectively.

The weekly chart for Amazon is neutral, with the stock above its key moving average of $417.67, but with weekly momentum projected to decline to 74.47 this week, from 75.17 last week.

Investors looking to buy Amazon should place a good till canceled limit order to purchase the stock if it drops to $383.18, which is a key level on technical charts until the end of 2015.

Investors looking to book profits should consider a sell stop given a weekly close below the key weekly moving average, which is rising at $417.66. This moving average will continue to rise each week.

There are three key levels on technical charts -- $406.23, $409.91 and $420.11 -- that are in play until the end of June.

Here's the weekly chart for Google.


Courtesy of MetaStock Xenith

Google had a close of $551.69 on Thursday, up 4.1% year to date. The stock is on the cusp of its 50-day and 200-day simple moving averages of $550.14 and $552.26, respectively.

The weekly chart is neutral, with the stock just above its key weekly moving average of $550.39, with weekly momentum projected to decline to 41.18 from 42.46 a week ago.

Investors looking to buy Google should place a good till canceled limit order to purchase the stock if it drops to $526.68, which is a key level on technical charts until the end of 2015.

Investors looking to reduce holdings should place a good till canceled limit order to sell the stock if it rises to $605.84, which is a key level on technical charts until the end of June.

Here's the weekly chart for Netflix.


Courtesy of MetaStock Xenith

Netflix had a close of $625.44 on Thursday up 83% year to date . The stock is well above its 50-day and 200-day simple moving averages of $542.77 and $444.99, respectively.

The weekly chart is positive but overbought, with the stock above its key weekly moving average of $576.86, with the weekly momentum reading well above the overbought threshold of 80.00 at 94.64.

Investors looking to buy Netflix should place a good till canceled limit order to purchase the stock if it drops to $545.67, which is a key level on technical charts until the end of June.

Investors looking to book profits should consider a sell stop, given a weekly close below the key weekly moving average, which is rising at $576.86. This moving average will be rising each week.

Here's the weekly chart for Tesla.


Courtesy of MetaStock Xenith

Tesla had a close of $245.92 on Thursday, up 11% year to date, and the stock above its 50-day and 200-day simple moving averages of $224.60 and $227.71, respectively.

The weekly chart is positive but overbought, with the stock above its key weekly moving average of $234.40, with weekly momentum well above the overbought reading of 80.00 at 89.11.

Investors looking to buy Tesla should place a good till canceled limit order to purchase the stock if it drops to $227.99, which is a key level on technical charts until the end of June.

Investors looking to book profits should place a good till canceled limit order to sell the stock if it rises to $274.98, which is a key level on technical charts until May 12.

This article is commentary by an independent contributor. At the time of publication, the author held no position in the stocks mentioned.

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