Stocks dribbled higher on Wednesday to celebrate the seven-year anniversary of the current bull market, which started on March 9, 2009 (on a closing low basis). Since then, when the Dow Jones Industrial Average hit a low of 6,547, large-caps have gained nearly 160% to flirt with the 17,000 level. Last May’s high of 18,351 is a gain of more than 180%.
But the celebratory spirit was subdued, with the major averages posting only modest gains as two major central bank decisions loomed. Thursday morning brought a decision from the European Central Bank to cut interest rates and expand its bond-buying program. March 16 will see the Federal Reserve’s decision on whether to raise interest rates again.
With stocks technically short-term overbought, and with values hard to find as breadth expands rapidly, here are three stock charts to watch as we head into Thursday’s trading day: Chevron Corporation (NYSE:CVX) and Intel Corporation (NASDAQ:INTC) and iShares MSCI Spain Capped ETF (NYSEARCA:EWP).
Chevron Corporation (CVX)
Oil and gas stocks were red-hot earlier this month, but have since cooled as the apparent upside breakout in crude oil prices stalled in recent day. Shares of CVX didn’t get the memo, it seems, gaining 4.6% on Wednesday on an analyst upgrade following the reaffirming of its production growth and the announcement of new spending cuts on Tuesday at its annual analyst meeting.
The downtrend pattern that’s been in place since November was broken, setting up a run at the November high near $97.
Intel Corporation (INTC)
Chipmaker giant INTC is on the cusp of jumping up and out of a three-month consolidation as it chews on overhead resistance from its late January high and its 200-day moving average near $31. Shares have been in irons, so to speak, since 2014 as the PC upgrade cycle that was supposed to accompany the Windows 10 launch never materialized. New initiatives, such as a push into the Internet of Things, has yet to be a meaningful revenue driver.
But some upside momentum is building after Baird analysts upgraded the stock earlier this month on their belief the company’s data center business has achieved critical mass necessary to drive earnings per share growth starting in 2017. I have recommended the March $31 INTC calls to Edge Pro subscribers.
iShares MSCI Spain Capped ETF (EWP)
Spain is a member of the so-called “PIIGS” — Portugal, Italy, Ireland, Greece and Spain — that have been at the center of the eurozone debt crisis since it first crashed onto the scene in 2010. Remember the May 2010 flash crash? With imagery of fiery protests in Athens split screened against a tumbling U.S. stock market?
If the ECB delivers the goods, amid recent fears about the health of European banks amid the reappearance of sovereign bond risks, the stocks of PIIGS countries will benefit the most. EWP, with exposure to stocks like Banco Santander (SAN).
Anthony Mirhaydari is founder of the Edge and Edge Pro investment advisory newsletters. Free two- and four-week trial offers have been extended to InvestorPlace readers.
