Chart of the Week: Comparing, Tesla, Mic ...

Chart of the Week: Comparing, Tesla, Microsoft, and Nvidia to Apple.

Sep 09, 2023

The headlines focused on the Chinese government’s recent “ban” on Apple’s iPhones.  The details were a bit sketchy but the effect on Apple’s stock (AAPL) were clear. The stock sold off aggressively, and may take a while to recover.

As the price chart above shows, the stock broke below its 20 and 50-day moving averages.  Interestingly, the Accumulation/Distribution (ADI) and On Balance Volume (OBV) indicators did not break down. That suggests investors are waiting for further developments and that the selling was more likely related to short term traders getting spooked. Apple has an event scheduled in the next few days where it is expected to unveil new products. The response to the event, bullish or bearish, will tell us a lot about what's next for the stock.

Nevertheless, there are very few Volume by Price (VBP) bars between $170 and $155, which means the stock is vulnerable to more selling. 

On the other hand, Microsoft (MSFT) moved higher on the day despite the bad news for Apple. As you can see the VBP bar at $330 is proving to be excellent support as it is paired with the 50-day moving average.

For its part, Nvidia (NVDA) showed some weakness but did not break down.  Again that VBP bar near $450 and the 50-day moving average are proving to be decent support. A break below this key price area, however, could lead to significant weakness in NVDA.

Finally, the jury is still out on what the next move for Tesla (TSLA) might be.  You can see the stock closed last week below its 50-day moving average. A break below $240 could take the stock down to the $200-$210 area where there is great support in the form of the 200-day moving average and a large cluster of VBP bars.

I am particularly interested in what’s going on with Tesla, as I recently posted here.

Incidentally, I’ve been receiving requests from followers regarding availability of coaching services for traders.  I am considering the addition of such a service to this page.  If you’re interested send me a message here as it will help me to gauge the potential interest in such a service and will help me to make a final decision over the next few weeks.

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