The S&P 500 index is still hovering just below its highs as the broad market index is now one week into the worst month, statistically, out of the year. The consolidation would normally be welcome, if optimism towards the market weren’t so sky high. With the CBOE Volatility Index bobbing around its lows and investor sentiment on its highs, it’s clear that the current market is custom made for the stock pickers.
Today’s three big stock charts look at the technicals for Amazon.com, Inc. (NASDAQ:AMZN), Nvidia Corporation (NASDAQ:NVDA) and Twilio Inc (NYSE:TWLO) as all three of these companies are signaling short-term profit potential for nimble traders.
Amazon.com, Inc. (AMZN)
We’ve been hitting on Amazon for the last few weeks as this is one of the canary in the coalmine stocks for the Nasdaq Composite. In other words, the market is likely to follow Amazon’s lead. In this case, AMZN stock is teetering on another potential decline, which will have bearish implications for the market.
- Amazon shares are bouncing between the $980- and $1,000-mark as traders are unconvinced that the current support levels will hold.
- Overhead, the 50-day moving average is combining with the $1000-level as potential double-barreled resistance, which has additional bearish implications.
- In addition, AMZN’s 50-day moving average is rolling over into a declining pattern. A rollover of this trendline will switch Amazon’s outlook into a short-term bearish outlook.
Nvidia Corporation (NVDA)
Nvidia is heading into their earnings announcement next week. NVDA stock is breaking above into new high territory, which will start to attract some “buy the rumor” buyers.
- While on a steady, low volatility rally, Nvidia shares have avoided hitting any type of overbought signals from the stock’s RSI. In addition, the momentum indicators are registering higher readings indicating a likelihood that the stock will maintain its rally into earnings.
- One caveat is that NVDA stock is likely to hit overbought readings within the next week. Historically, this is a stock that when overbought at earnings tends to see heavy profit-taking immediately after their report.
Twilio Inc (TWLO)
Twilio shares have been in a worsening pattern of lower lows and lower highs of late and the stock is now heading into a technical test that should set the stage for the next month or two of trading.
- Today’s rally in TWLO has seen it shoot up to the shares’ 200-day moving average. This trendline has been in a declining pattern for some time and provided resistance for the stock in July.
- On the positive side, Twilio shares’ 50-day moving average just finished transitioning into a bullish outlook as the trendline is now ascending. This indicates that the stock has a 2:1 likelihood of moving higher while the trendline is on a positive slope.
- The $30-level is also the site of TWLO’s 10-month moving average. This longer-term trendline may act as resistance; however, a sustained move above will bring even more buyers into the crowd. Target the stock to hit $35 on a bullish move.
As of this writing, Johnson Research Group did not hold a position in any of the aforementioned securities.
