Semiconductors from the IBD50 have been outperforming, with additional gains yet to come. Three of the top ten pre-market movers are chips and more are ticking higher before the opening bell.
Summary
NVidia is trading above previous pivots highs, no doubt ready to run higher into earnings, as attention shifts back to the leaders in AI. NVDA reports on 11/10/2017.
Technically the stock has cleared its short-term resistance at 191.20. RSI has room to run and price action is trading higher with no overhead supply to impede the company’s progress.
Micron (MU) has been a favorite of the media and fund managers. Pre-market trading suggests we should see and follow-through day and continuation of the trend.
MACD is in a strong uptrend, leading above its signal line since early August. Volume suggests institutions have been adding this company to their portfolios unabated.
Watchlist – Semiconductors – IBD50
Other stocks in the semiconductor group grace the weekly watchlist over the past few weeks. AMAT LRCX and MCHP favorites for follow-through in the short term. AMD and MRVL are bullish too, so there is potential to add to these positions.
Cypress Semiconductor was the topic of conversation Fast-Money last night. In that episode, Guy Adami talked about the company’s restructuring efforts. Management has spun off less profitable parts of the organization, focusing on new ventures in “the internet of things.”
- Cypress Semiconductor Corporation CY up 3.4 percent following a positive mention from CNBC’s Guy Adami on ‘Fast Money.’ The trader warned shorts may need to cover related to the company’s upcoming end-of-October earnings report.
Technically, the weekly chart cleared a buy point at 16.00 in a large cup with handle base. Price is above the rapidly accelerating 9/20ema on this time frame. RSI and MACD suggest higher prices in the intermediate term.
CY daily is a bit extended so we are watching for a potential flag in the short-term. Earnings are scheduled for October 26.
Overall, semiconductor stocks show a lot of promise. Whether you like to day trade or swing, there are plenty of setups this week to choose from.
Happy Trading,
Vinny
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