3/12/2017 – Mobileye (MBLY) Coverage Re-Initiated
Put on the brakes! As I was perusing the Investors Business Daily newspaper today, I noticed a familiar stock in the top 50 stocks - Mobileye (MBLY). It actually ranked as #23 overall.
Mobileye (MBLY) is a company that has been covered by me before at Trendy Stock Charts. But like other stocks, sometimes things just sort of fall off the radar.
Making the top 50 stocks for Investors Business Daily is no easy feat. There are a couple of other stocks covered by Trendy Stock Charts stock in the top 50 list also, nVidia (NVDA) & Facebook (FB).
For now, let's start off with reviewing stock charts for Mobileye (MBLY), the company that helps with autonomous braking and much, much more. Their sensors can be found all over vehicles that are being developed for fully autonomous driving. Their current focus is on a crash avoidance system. Visit their official website here.
I figure, if their stock is in the top 50, its chart must look pretty good. So let's take a peek at its charts and see if we can jump in on the uptrend for this top 50 stock. The first view will be the long-term birds-eye view, the 20 year monthly chart. It's been a while since I've covered it last and I also don't have the previous articles available as those were under my previous web host provider.
Mobileye (MBLY) - 5 Year Chart
I'm not connected to my backup device right now, so I'm not exactly sure when my last article was for Mobileye. I know its been at least a year and a half, maybe even two years.
After pulling up a 20 year chart, I realized I only needed a 5 year chart for Mobile (MBLY). I forgot just how new of a public company they are. The company's stock has less than 5 years of trading since its IPO. So this is a 5 year monthly candlestick chart that captures all of Mobileye.
This monthly chart has several things that seem to indicate a re-test of the resistance area from the Doji candlestick pattern:
- The last couple of months have seen increasing overall buying volume
- The MACD Histogram is showing increasing buying momentum long-term and there appears to be plenty of runway left for the momentum to continue
- The minimum trade appears to be the resistance area from the Doji candlestick pattern
- The chart set-up looks really good - I think the Golden Ratio (161.8% Target Line) is in play rather than just the 100% Target Line
MBLY - 3 Weeks Tight Chart Pattern
This is a 2 year weekly candlestick chart. It just so happens that Mobile (MBLY) has formed a 3 Weeks Tight chart pattern over the last 3 weeks. An upside breakout could be eminent.
With a weekly MACD Histogram that is just starting to show a slow-down in buying momentum, I may use any weakness in the share price early in the week to make a scale-in purchase and go long shares of MBLY. The $42 - $44 price area looks like a good place to start if it does.
A second scale-in purchase can be made if its share price continues pulling back all the way to the supporting trendline. That trendline sits approximately around the $37 price level.
MBLY - Moving Averages
This is a 1 year daily candlestick chart for Mobile (MBLY) taking a look at its price action from a moving average perspective. If MBLY is breaking out from its 3 Weeks Tight chart pattern as anticipated as soon as this week, it should bounce from the 20 Day and then use the 10 Day moving average during its uptrend.
MBLY's dip to the $34 price level in December 2016 was its 1st dip below the 200 Day moving average after it's share price developed a Golden Cross pattern back in July 2016. I'm not sure that will happen again this time.
I feel like the lowest drop for this uptrend will be the 50 Day moving average, and that will only be if the market experiences some weakness over the next 2 weeks.
Mobileye (MBLY) - Summary
The charts for Mobile (MBLY) look favorable, both in the shorter and longer-term. This is one of the better chart set-ups that I have seen while doing stock updates over the last couple of weeks. A good chart setup is the first significant part for any good trade or investment.
Consider using any weakness in the market over the next week or two to purchase a few shares of MBLY and go long for the next couple of months. At a minimum, if MBLY's share price just goes back to re-test the resistance area, that is an approximate 30% gain from Friday's closing share price.
However if MBLY's share price breaks through the resistance area from the Doji candlestick pattern, its share price could see 75% returns in less than 6 months.
While I don't have a ton of cash on hand, I may consider selling some more of my Apple shares this week to help fund the purchase of MBLY shares. I will be looking to hopefully purchase some shares around current price levels or slightly below if I get the chance. Any shares purchased will be held until the Doji resistance area is re-tested.
If you decide to join the trade, ask for an update in the Idea Chamber. Until then,
Good luck trading!