The Tech Sector Takes Lead In 2019

The technology sector has been the best performing sector in 2019 thus far.  Within the sector, Nvidia (Ticker Symbol: NVDAWealth Strength IndexNVDA is Extremely Flat and trending Up) has led the Nasdaq higher this week, rallying over 12%.

The chart above shows the performance of the Nasdaq (Shown by the Nasdaq EFT: QQQ) compared to the Dow Jones (Red Line) and the S&P 500 (Green Line). As you can see, the Nasdaq has outperformed both indices for most of the year and is really gaining its lead this week with strong performances out of Nvidia (Ticker Symbol: NVDAWealth Strength IndexNVDA is Extremely Flat and trending Up) and Broadcom (Ticker Symbol: AVGOWealth Strength IndexAVGO is Moderately Flat and trending Down). The Dow and the broader market had headwinds from Boeing shares.  After the news of its second 737 crash, the stock lost $26.6 billion in the first two trading days.

Nvidia’s stock has posted a good rally this week leading the Nasdaq higher.  After making an all-time high of 292.76 early in the fourth quarter of 2018, Nvidia’s stock took a hard slide into the end of the year, correcting over 50%.  Since the start of the year, Nvidia has been in a horizontal basing pattern, finding support around the $130.00 price level. It recently traded above its 100-day Moving Average around the $161.00 level.  If strength in the Nasdaq continues, Nvidia could break out above its horizontal basing pattern, leaving the 200-day Moving Average as its next natural target around $210.00

(Chart above courtesy of ​www.tipranks.com​)

Based on a survey of 36 analysts across Wall Street, the average price target for Nvidia’s stock is 185.30.  Based on that number, the stock is priced at a discount relative to Wall Street’s analysts. Nvidia’s stock is currently trading at 170.25.

Above is the daily chart for Boeing’s stock.  Boeing had one of the strongest starts to 2019.  After putting in a double bottom pattern and finding support just below the $300 level, the stock rallied nearly 50% in two months to an all-time high $446.01, breaking through its downtrend from 2018 and crossing above its 200-day Moving Average.  Just over a week after it made its historic high, the stock lost upwards of $25 billion in market cap in the first 48 hours following the crash of Ethiopian Airlines Flight 302.

(Chart above courtesy of ​www.tipranks.com​)

Based on a survey of 36 analysts across Wallstreet, the average price target for Boeing’s stock is 185.30.  Based on that number, the stock is priced at a discount relative to Wallstreet’s analysts. Boeing’s stock is currently trading at 378.67.

Much of the news that has affected Boeing’s stock price has put pressure on the overall market this week, allowing the Nasdaq to continue stronger. With earnings season closing down, the market may lack news for fresh catalysts.  As for now, the Nasdaq remains the leader of the indices. We will see in time if the Nasdaq’s reign as the king can last.

 

 


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