Daily Technical Analysis of Stock Market – February 21st 2020
Facebook, Inc. (FB) currently has a market cap of 598.9B USD and trades around 210 USD as it set a lower high earlier this week around 218 USD and declined further during the rest of the week. This was seen after several month of bullish momentum without a significant retracement and resulted in a new all-time high of 224.2 USD being made on 29th of January
Therefore, a further drop is expected as the price looks to retrace some of the upswing. Potential support area can be seen between 100 and 200 day moving averages that are seen as a blue and green line respectively. Additionally, this is the area between 50-61.8% Fib retracement as well as 193 USD previous support/resistance level.
Until then, it is best to stay neutral and wait for a further retracement.
Apple Inc. (AAPL) currently trades around 312.38 USD with a market cap of 1.367T USD as it continues to consolidate below the 327 USD all-time high that was set at the 29th of January.
This week looks to close bearish and likely we will see further downside next week, therefore, important is how the price will react to 302.22 USD previous local low. If the price moves below it, we will likely see further downside in the upcoming weeks as a much larger retracement will play out after several months of strong bullish momentum. Alternatively, if rejection for further downside is seen around the 302.22 USD support and another higher low is made, a long position can be taken with the expectation that further all-time highs will be made.
Amazon.com, Inc. (AMZN) currently has a market cap of 1.044T USD and trades around 2,097 USD as it has started to move lower after setting a new all-time high around 2,185 USD and consolidating slightly below this level for the past days.
Therefore, we expect a further retracement to be seen in the upcoming weeks towards the support area around 1,850-1,950 USD. Around this price level, we can see previous support/resistance levels of 1,850 and 1,910 USD in addition to 50-61.8% Fib retracement from the previous upswing as well as both 100 and 200 day moving averages moving towards this area. Until it is reached, the best option would be to stay neutral and wait for a further retracement.
Netflix, Inc. (NFLX) currently has a market cap of 166B USD and trades around 380 USD as it has broken above a symmetrical triangle pattern during the past weeks, however, after reaching previous swing high of 384.76 USD, a rejection was seen this week and the price look to close this week with a bearish pin bar.
Therefore, a short position can be made with the expectation that the price will move lower during the upcoming weeks as it looks to set another higher low, potentially around the trend line that extends from the two previous major lows.
Alphabet Inc. (GOOG) currently has a market cap of 1.019T USD and trades around 1,483 USD as it starts to retrace after setting a new all-time high around 1,532 USD and consolidating below it for the past week.
Since a clear higher high was made during the previous local upswing, we can expect the price to continue overall momentum and move higher after a new higher low is made above 1,425 USD. Potential reversal area can be seen around the several month ascending support trend line and would mean a reversal around 1,450 USD.
Until this area is reached it is best to stay neutral and wait for further price action development in the form of retracement and a new higher low.
Dow Jones Industrial Average (DJI) currently trades around 28,965USD as it set a new all-time high last week after a slight retracement. This week, however, we have seen further downside and this could potentially be seen as a beginning of larger retracement.
Overall the market has been in a steady uptrend for the past months without a significant retracement, therefore, a retracement that sets another major low would be a healthy sign and allow to enter a market with much better risk/reward ration. A potential area for the retracement to reach can be seen around 27.2-27.6 USD. Additionally, 50-61.8% Fib retracement from the current several month upswing can be seen around this area and it will likely be supported by 100 week moving average blue line in the upcoming months.
Until this area is reached it would be best to stay neutral, however, if the price does show signs of rejection for further downside around above the 28,169 USD previous local low, a long position could be taken with the expectation that the current upswing will continue higher.
S&P 500 (SPX) currently trades around 3,333 USD as it starts to retrace after setting a new all-time high at 33,93 USD this week.
Since the overall trend continues being very bullish, we can expect a retracement towards 3,250-3,300 USD area before the price reverses back to the upside as it is the area where the previous resistance level of 3,258 USD is located in addition to 81.8% fib retracement.
Until this area is reached and a clear rejection for further downside above the 3,217 USD low is seen, it is best to stay neutral and wait for further price action development.
Russell 2000 (RUT) currently trades around 1,679 USD as it looks to set a lower local high after failing to reach the 1,740 USD all-time high, however, setting another higher local high.
Therefore, once a further retracement is seen that sets another higher low, a long position can be entered with the expectation that the next upswing will likely set a new all-time high. A potential area where the retracement could end can be seen around 1.6k previous resistance as well as a 100-week moving average around 1,577 and 50-61.8% Fib retracement at 1,558-1,588 USD.
Until then, it is best to stay neutral and wait for further price action development.