BREAKOUT OF THIS CHEAP DINOSAUR POWERING DOW HIGHER $INTC $NVDA $MSFT $GOOG $TSLA $AMD $QCOM $AAPL $SPY $SMH

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BREAKOUT OF THIS CHEAP DINOSAUR POWERING DOW HIGHER $INTC $NVDA $MSFT $GOOG $TSLA $AMD $QCOM $AAPL $SPY $SMH

At the end of September, we shared with subscribers of The Arora Report our forecast that the stock market would rise at the beginning of October.

The forecast has proven to be correct, yet it wasn’t rocket science. It was based on a simple observation that new money pours into Wall Street at the beginning of a quarter from pension funds.

And it turns out that money managers have deployed the new money in a dinosaur that had been left for dead. The dinosaur is chipmaker Intel INTC.  It turns out that the breakout in Intel’s stock is powering the Dow Jones Industrial Average DJIA.  Let’s explore that investment starting with a chart.

Chart

Please click here for a larger annotated chart of Intel’s stock. Please note the following from the chart:

• This is a weekly chart and, thus, is of more value in analyzing a breakout.

• The price of Intel is breaking out.

• The breakout is from a so-called triple top.

• Breakouts from a triple top tend to have a higher probability of being successful.

• The RSI (relative strength index) is barely overbought and shows that there is significantly more room to run.

• The breakout is on low volume. This is negative and poses risks for those buying at current levels.

Ask Arora: Nigam Arora answers your questions about investing in stocks, ETFs, bonds, gold and silver, oil and currencies. Have a question? Send it to Nigam Arora.

Why the breakout now?

The gurus are out in full force regurgitating the old news as a reason for the breakout. My 30-plus years of experience in the markets has shown that breakouts are seldom caused by stale news….Read more at MarketWatch

See also  WEEKLY STOCK MARKET DIGEST: MARKET BULLS STAMPEDING AS MISLEADING MOMO GURU NARRATIVE TAKES HOLD

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