We’ve been presenting both sides of the market over the last week as the major indices like the S&P 500 Index continue to move with little direction. Given this, we thought that it was a great idea to end the week on a positive note by checking in on some of the larger named stocks that are bucking the trend and moving to new 52-week highs.
A combination of relative strength and in most cases recent positive news from the earnings front have helped push shares of Shopify Inc (US) (NASDAQ:SHOP), Broadcom Ltd (NASDAQ:AVGO) and Alibaba Group Holding Ltd (NYSE:BABA) to their respective highs and on our list of review as today’s three big stock charts.
Shopify Inc (US) (SHOP)
Shopify shares suffered some weakness in August, but shares are now breaking through to new highs after the stock bounced from technical support. While brick and mortar retail appears to be showing more signs of life, the online retail empires continue to grow, suggesting that SHOP isn’t finished with its climb.
- Shares of Shop.com are breaking above key chart support at $105. This level stopped the stock in its tracks in early August after the company’s earnings report cause a spike and volatility. We’re likely to see some resistance, but the move above this price will accelerate the upside trend.
- The RSI for SHOP stock is nearing an overbought indication, signaling that the stock may see some selling pressure mount as $105 is pressured. Expect that this would create a buying opportunity for the traders out there.
- The bulls are watching Shopify shares closely as the stock just broke above its top Bollinger Band. Another day above this level ($106) will initiate more upside volatility and continue the overbought rally to a target of at least $110.
Broadcom Ltd (AVGO)
Semiconductor stocks have had a rough go for the last two months as there has been a rotation from the group into more defensive names. Broadcom shares have been bucking the trend of its peers like Intel Corporation (NASDAQ:INTC) though as AVGO stock is now breaking to new highs.
Broadcom is running into some pressure, let’s see what the charts suggest.
- Outside of Nvidia Corporation (NASDAQ:NVDA), AVGO has become one of the stronger relative strength leaders in the semiconductor sector. The stock is now tracking to break through what has been a trading range that has lasted since June.
- The top of this range is identified at the $255 price point, which is currently rejecting shares on a short-term basis; however, momentum has been turning positive.
- Support for Broadcom shares is holding securely at the stock’s 50-day moving average. This trendline is shifting into a bullish pattern, indicating more strength in AVGO over the next 4 to 6 weeks.
Alibaba Group Holding Ltd (BABA)
Alibaba gave investors and traders exactly what they wanted with their latest earnings report.
As a result, BABA is once again on track to continue positing new highs as the bulls remain in control of this popular online shopping name.
- Alibaba stock is running into some short-term selling as the stock hit overbought readings on its RSI indicator. This is the only reason that the stock is seeing overhead pressure.
- Adding to the short-term weakness is the fact that BABA shares are slipping back below their top Bollinger Band. This indicates that the bullish volatility rally that was triggered by the company’s earnings report is coming to an end.
- The short-term selling pressure may take Alibaba stock to its closest support level that is currently identified at $165. At this point, BABA stock will be back on the bull’s targeted buy lists.
As of this writing, Johnson Research Group did not hold a position in any of the aforementioned securities.
