3 Big Stock Charts for Wednesday: AT&T Inc. (T), Facebook Inc (FB) and Advanced Micro Devices, Inc. (AMD)

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The technology sector continues to see more selling than other groups as investors are taking profits from this group of performance-leading stocks. As we mentioned yesterday, a growing number of companies in the technology group are beginning to show signs that the short- to intermediate-term outlooks are worsening. In other words, it’s time to start avoiding a growing list of stocks.

Today’s three big stock charts takes a look at the technical analysis of Advanced Micro Devices, Inc. (NASDAQ:AMD), Facebook Inc (NASDAQ:FB) and AT&T Inc. (NYSE:T) as each are preparing to dig lower on their charts as their technical pictures worsen.

Advanced Micro Devices, Inc. (AMD)

Advanced Micro Devices, Inc. (AMD)
Source: Chart courtesy of StockCharts.com

We talked about Advanced Micro Devices last week as the stock was starting to show signs that the intermediate-term technicals were degrading. Today, AMD stock breaks below its 50-day moving average, a trigger that will get the chart watchers hitting the sell button.

  • As mentioned, Advanced Micro Devices shares are crashing through their 50-day moving average on today’s selling. This trendline has supported the stock for only a short period as Advanced Micro Devices had been stuck in an intermediate-term bearish trend.
  • AMD did not hit an overbought signal from the stock’s RSI, indicating that the current selling is not triggered by profit-taking, but just by investors migrating away from a relative laggard name.
  • The 200-day moving average is set to act as some support for the stock at $11.75; however, Advanced Micro Devices shares are currently in the process of testing their 10-month moving average. This trendline has held AMD stock from extended selling over the last three months; however, a move below this long-term support will put the stock on the bear’s list.
Advanced Micro Devices, Inc. (AMD)
Source: Chart courtesy of StockCharts.com

Facebook Inc (FB)

Facebook Inc (FB)
Source: Chart courtesy of StockCharts.com

How can Facebook turn up on a list of stocks to be wary of? Although FB shares have been one of the stronger performers in the group, it looks like the profit-takers are ready to start cashing out.

Since Facebook is so widely watched, a correction in this stock will spread to the rest of the market.

  • We keep warning about FB because the stock is clearly prepping for a correction as the stock remains in technically overbought territory. The last similar overbought readings resulted in an 8% correction in the price of Facebook stock.
  • The MACD indicator on Facebook is transitioning into a weaker signal, indicating that the stock is losing momentum. From here, the traders will pick up on the decline and likely start selling the recent strength.
  • The technicals suggest that FB shares could fall as far as $158, which would represent a similar decline to the May overbought signal that occurred after the company’s earnings report. This would be a carbon copy move according to our charts.

AT&T Inc. (T)

AT&T Inc. (T)
Source: Chart courtesy of StockCharts.com

Communications stocks have been struggling lately, and now the media stocks are taking a hit as their earnings reports aren’t hitting the numbers that investors had expected. AT&T spent the last few years in a sweet spot as the company was growing and paying a nice dividend, now, the stock is threatening to break even lower.

Shares of T are still crowded with bulls, so this is one that you want to watch out for.

  • AT&T shares are still widely held, despite their lack of relative strength. The stock continues to disappoint on many fronts, but the market has been giving it a pass until now. The recent fundamental weakness is drawing more technical sellers into the mix.
  • After an unexpected earnings surprise, T stock shot through its 50- and 200-day trendlines, both of which had been in bearish patterns. The stock’s 200-day moving average has already rejected the shares, now the 50-day will stand as an important technical test.
  • From a strictly chart perspective, AT&T shares should find some support at $38; however, a break of round-numbered support will put the 50-day in play almost immediately. Traders would be wise to hold off on trying to jump on this bandwagon stock.

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


Article printed from InvestorPlace Media, https://investorplace.com/2017/08/3-big-stock-charts-for-wednesday-att-inc-t-facebook-inc-fb-and-advanced-micro-devices-inc-amd/.

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