The big earnings day for tech stocks has finally arrived, and Wall Street cheered the results. On Thursday evening, Apple (NASDAQ:AAPL), Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG), Amazon (NASDAQ:AMZN), and Facebook (NASDAQ:FB) reported their quarterly numbers.
They all shot higher in post-market trading, but it was Apple that captured the most impressive gains after declaring a 4-for-1 stock split. And with the bullish sentiment likely to reignite tech stocks into the weekend, I’m dedicating today’s gallery to spotlighting a few breakout patterns that I like.
So, since the mega-caps above are already on everyone’s radar, we’re looking elsewhere for quality trending tech companies to purchase. But we need more than an uptrend. We need an uptrend with a quality setup.
Fortunately, I found three compelling breakout patterns in today’s candidates. One already blasted through resistance, and the other two will likely trigger by the time you’re reading this. Here they are:
With all of that in mind, let’s take a closer look at their charts and build out bull calls to profit.
Tech Stocks to Buy: Nvidia (NVDA)
The semiconductor industry saw quite the shake-up this earning season. Intel confirmed its no longer a leader in the space, and its stock price got hammered. Oppositely, Advanced Micro Devices (NASDAQ:AMD) and Taiwan Semiconductor (NYSE:TSM) both shot to the moon — making Intel’s pain their gain. Meanwhile, Nvidia has been quietly and consistently trending higher, more than doubling off the March low.
Its ascent has been oh-so-consistent, with the 20-day moving average acting as support the entire way up. The past three weeks have seen a textbook high-base pattern form. Thursday’s 1.42% gain ushered NVDA stock to the cusp of a breakout. And with earnings a little less than two weeks away, I think we could see a ramp into the number; Particularly given the love affair we’re seeing with tech stocks both before and after last night’s earnings extravaganza.
The Trade: Buy the Aug. $430/$440 bull call spread for around $4.50.
While Nvidia shares more than doubled over the past four months, SPLK stock has almost tripled. Its rising 20-day moving average has been a gathering ground for dip buyers along the way, consistently halting every selloff. While we have seen some selling sorties attack tech stocks over the past month, Splunk shares have held firm to their uptrend.
With Thursday’s pop, SPLK is fast approaching its $213 resistance zone. The ascending triangle pattern from the past month confirms buying aggression is on the rise. Couple that with the imminent breakout, and I think it’s time to pull the trigger on bullish trades.
Once again, I prefer short-term bull call spreads to capitalize.
The Trade: Buy the Sept. $210/$220 bull call for around $5.00.
Tech Stocks to Buy: Skyworks Solutions (SWKS)
While the rest of the market was sagging on Thursday, Skyworks Solutions was soaring. The 4.21% jump completed a two-month cup-and-handle pattern with an exclamation point, and participation surged — driving the session’s volume well above average to 3.18 million shares.
With SWKS now at a record, it boasts the benefits of all stocks basking at all-time highs. There isn’t a soul on the planet sitting with an unrealized loss. And everyone who already sold wishes they hadn’t. That creates a powerful bullish force that should continue to propel the stock higher.
A run to $150 seems entirely possible over the next week.
To capitalize, let’s build another bull call spread.
The Trade: Buy the Sept. $140/$150 bull call for around $4.90.
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