Chartsmarter Insights

Blast From The Past Could Be Ready: We are well aware that the semiconductors have done the bulk of the heavy lifting within technology in the first quarter of 2023. Some have participated more than others, and of course NVDA there must be given an honorable mention up nearly double this year so far. AMD is trying to stay in the same sentence and has acted well POST breakout above a cup base pivot of on 89.04 taken out on 3/15. Not surprisingly it is meeting some difficulty at the very round par number here. On the other end of the spectrum laggards which are in the red YTD include WOLF TSEM and AMBA. Below is the WEEKLY chart of MU which is showing some signs of life here, but it should gravitate toward the very familiar 65 level in the near term (the ascending triangle can also be looked at as a complex inverse head and shoulders). On its daily chart, it is just above a double bottom with handle breakout pivot of 61.88 from 3/29. Will the 64 area become a triple top from last November and this January?

Wheres The Beef? I am old enough to remember the brilliant commercials from the late Dave Thomas. One of the best perhaps was the slogan, "Wheres The Beef"? It was in reference to the burger wars that went on between MCD and BKC, the latter before the merger with Tim Hortons. Currently, MCD looks appetizing, pun intended, as it trades between a taut range between 260-280, and on its WEEKLY chart has the look of a cup base pivot just below 282, and a breakout would carry a measured move to the very round 300 number. It trades just 2% off most recent 52-week highs, while the chart below of WEN is 11% off its own annual peak, but looks good on both a WEEKLY and daily time frame. That slight weakness translates into a nice dividend yield of 4.7%, double that of MCD. Below is the daily chart of Wendys and the WEEKLY chart has the look of potentially building the right clavicle in a bullish inverse head and shoulders pattern. A move above a 24.50 trigger would carry a measured move to 32. And on top of that one has the Peltz put, although he did mention in January he is not interested in acquiring the name.

Worth A Second Look: The Swiss-based energy and resources play Glencore since a breakout above a WEEKLY bull flag formation near 14 the week ending 1/20 proved to be a "bull trap". Long-time readers of our work know our affinity with round number theory and the week ending 3/17 defended the 10 level very well. The daily chart below shows both the 3/15-16 sessions were below 10 intraday, but each CLOSED above it. With the 5% gap up on 3/20, it completed a bullish island reversal after the 10.4% gap down on 3/15 in double the average daily volume. This week so far is up better than 4%, and if it can generate a positive week this week would be just its second back-to-back WEEKLY gains in the last 4 months. It pays a nice dividend yield of 4.6% and with the greenback in decline since a spinning top candle on 3/8 after a spirited run from par on 2/2 this may be the wind at its back to propel this to further gains. We were WRONG and early on this name in our 2/24 Energy Note but think this name merits a second look.

Forbidden Fruit? In our last WEEK AHEAD note we took a look at a couple of individual names that showed promise. One was the chart of PINS and the other was the chart below of AAPL. This name is the largest cap play on earth so it demands everyone's attention. It has produced a WEEKLY breakout above the bullish inverse head and shoulders pivot of 157, but the last couple of sessions have recorded bearish candlesticks. Wednesday registered a shooting star and Thursday a spinning top. Now of course for this play to be valid it must CLOSE above the 157 trigger on Friday. Perhaps all the chatter about the Nasdaq advance-decline line heading lower, in the opposite direction of the benchmark itself is starting to weigh. Remember PRICE action is omnipotent to each indicator and everyone one of them reacts to PRICE. An indicator is something to should be watched intently but not acted upon until PRICE confirms. Tomorrow will be a very interesting session, to say the least. Will an apple a day keep the bears away?

The Rotation Continues: The Nasdaq continues to be where most of the positive action emanates from although there are some legitimate concerns. There seems to be an abundance of chatter, as just recently it seems like much of the movement is being very concentrated among the big names. That is showing up with a downturn in the Nasdaq Advance-Decline line even though the benchmark is moving higher. Notwithstanding the reversal today of course for the tech heavy index off the very round 12000 number, which is also occurring right after a double bottom breakout. And we know the best breakouts have a tendency to work right away, so that is something to be concerned about. Wednesday registered bearish engulfing candle, not optimal, but lets see for the rest of the week CLOSES out. The group overall has been making it a habit recently for being at the top of the major S&P sector leaderboards and today was no different being the second "best" of the 11 major S&P sectors, but still CLOSING lower by 1% via the XLK. The SMH CLOSED the second straight session off session highs, recording a bearish shooting star, and this is not something bulls want the group to be accustomed to.