3 Big Stock Charts: Intel Corporation (INTC), Western Digital Corp (WDC) and Lexicon Pharmaceuticals, Inc. (LXRX)

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Investors are going to spend much of the week waiting on the Federal Reserve for the decision on interest rates before committing new monies to the market. The question of whether rates will go higher is all consuming for many, but those of us watching the technicals and trends already have an idea of the stocks we want to hold regardless of what Janet Yellen says later this week.

Large cap technology and pharmaceutical companies continue to have favorable cash flow as traders are migrating monies away from the dividend paying sectors. Today, we look at three companies benefiting from that cash flow: Intel Corporation (NASDAQ:INTC), Western Digital Corp (NASDAQ:WDC) and Lexicon Pharmaceuticals, Inc. (NASDAQ:LXRX).

Intel Corporation (INTC)

160919 INTC Stock Price
Source: Chart courtesy of StockCharts.com

Along with other large cap technology stocks, Intel has undergone a fundamental turnaround increasing the demand for their chips and technology. INTC took a jump higher Friday as the company raised earnings guidance and now we’re looking at a situation where the analyst community is going to start fueling prices even higher.

This morning, Intel shares have already received one upgrade in price. With only 57% of the analysts on Wall Street recommending INTC stock as a buy, we also expect to see a number of upgrades.

Intel shares jumped above their top Bollinger Band on Friday on heavy volume. The move strengthens an already strong momentum trend for the stock, as INTC shares have support from short- and intermediate-term trendlines, as well as a strong moving average convergence divergence.

The move shifts Intel into a new bullish trend that is likely to move faster than the market, as the analyst community raises its outlook. This is even more likely to happen as INTC breaks above the $38 level, which would mark new highs for the stock since the 2000.

Western Digital Corp (WDC)

160919 WDC Stock Price
Source: Chart courtesy of StockCharts.com

Western Digital stock moved lower from the $55 level after its last earnings report. Now, WDC stock is poised to cross back above this mark, which will grab the attention of technical traders. In addition, we’ve just seen a very bullish crossover of trendlines that should paint a bullish intermediate-term outlook.

First, the $55 level has been resistance for Western Digital shares. The last time we saw WDC stock try to break above this point, it stumbled at resistance from its 200-day moving average. This time around, the 200-day is below the stock and actually poised for potential support.

In addition, the 20- and 50-day moving averages for WDC just completed bullish crossovers, indicating that the bullish trend for the shares is growing stronger. Historically, this intermediate-term bullish signal precedes outperformance of the shares against the market.

The current technical picture looks to be lifting resistance for Western Digital shares and opening-up a target price of $60.

Lexicon Pharmaceuticals, Inc. (LXRX)

160919 LXRX Stock Price
Source: Chart courtesy of StockCharts.com

Another sector of the dividend cash migration is big Pharma. Pharmaceuticals took a beating earlier in the year, as the presidential candidates signaled that they may take on the Phama industry over pricing issues. The political rhetoric has died down, leaving a number of undervalued stocks that are making technical improvements.

Lexicon shares jumped off the charts earlier in the month on positive news regarding one of its drug trials. LXRX stock has consolidated since then in preparation for what appears to be another rally higher.

The 20- and 50-day trendlines of Lexicon Pharmaceuticals just shifted into a bullish trend, as both are ascending and the 20-day has crossed above the 50-day. Historically, these patterns result in better-than-average performance for the drug maker that should attract more technical buyers.

LXRX stock will face a critical test soon as it approaches the $20 level. This mark has provided chart resistance for the shares before and may trigger some profit taking. A move above $20 will convince the technicians that the longer-term trend favors even more upside for Lexicon, drawing even more buyers into the mix.

As of this writing, Johnson Research Group did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2016/09/3-big-stock-charts-intel-corporation-intc-western-digital-corp-wdc-and-lexicon-pharmaceuticals-inc-lxrx/.

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