Today’s three big stock charts look at names that are making big moves on their charts. Shares of Walt Disney Co (NYSE:DIS) make the list for their recent rally that has left the market behind, while Adobe Systems Incorporated (NASDAQ:ADBE) is finally back to breaking into new relative high territory. Finally, in the news of the day category, shares of Qualcomm, Inc. (NASDAQ:QCOM) are trading more than 14% lower and taking out all kinds of chart support worthy of reviewing.
Walt Disney Co (DIS)
Disney shares appear to be reloading for another rally as the stock has consolidated once again to its short-term 20-day moving average. This is the third time that DIS stock has seen this type of action since the rally started in December. Now, more than 16% higher, momentum is suggesting that the short-term pullback in Disney is likely just another buying opportunity.
Momentum on DIS shares has been building with intermediate-term support underneath the rally, suggesting that if the selling were to increase, it would be contained at two important levels.
First, the stock’s 50-day moving average, which is trending higher and currently at the $102.50-level. Second, this is the same area that Disney’s lower Bollinger Band resides, suggesting that we would see more buyers some into the market around this price point.
Significant chart support builds in this area starting at $103, telling us that this intermediate-term bull likely has a long road to run as soon as this consolidation is finished.
Adobe Systems Incorporated (ADBE)
Here goes Adobe again! The software provider took a break from its rally to consolidate at the $108-level and get traction to make its newest run to break above $111. ADBE shares are opening trading this morning in this new high territory and will grab the attention of traders in doing so.
The catch, Adobe’s RSI reading is now hitting an overbought indication that could have some profit takers enter the market and begin to sell, but there is something we like about the timing of this signal.
ADBE will not drop their latest earnings news on the market until March 16, much later in the season than most of the technical companies. This offers the opportunity for Adobe stock to benefit from what has been a positive season so far, while trading with less volatility.
For now, we expect to see a small pullback after the break above $111; however, this should be met by fast and aggressive buying as the 50-day moving average for ADBE has just turned back into a bullish trend, which suggests that higher prices are likely as this trend grows stronger.
Qualcomm, Inc. (QCOM)
Qualcomm shares are trading more than 14% lower this morning after news that the company is being sued by Apple Inc. (NASDAQ:AAPL) and several downgrades have traders running to the hills. QCOM stock has sliced through all of its short-term trading support trendlines and is already breaking into a bear market trading pattern with the move below more significant support.
The significant support comes in the form of Qualcomm shares’ 20-month moving average, a trendline that is currently positioned at the $57.50-level. The long-term traders will be eyeing this number over the next week or so, as a break below this on a closing basis will draw even more QCOM sellers into the group.
As if the company needed more pressure. All but one of the analysts covering Qualcomm stock have it ranked a buy or strong buy. This tells us that there are likely to be a lot more downgrades coming forward on QCOM stock over the near-term, which will add yet more selling pressure to the stock.
For now, the stock remains a sell and not worthy of losing a finger by trying to catch this falling knife.
As of this writing, Johnson Research Group did not hold a position in any of the aforementioned securities.
