AMD, HIMX, MU & NVDA

I had a little bit of client work this weekend (yay!) as well as helping a few relatives prepare their tax returns. Funny how all my relatives remember that I’m a CPA around tax time….

This quick hits update will focus on the chip stocks that I’ve covered in previous articles or updates. Those stocks are Advanced Micro Devices, Himax Technologies, Micron Technologies and nVidia Corporation (AMD, HIMX, MU & NVDA respectively).

For each of these companies, I will review a bullish and bearish scenario for its share price. I will then provide indicators to watch for to help determine which scenario might be playing out.

I may even provide more than one chart to make sure the perspectives are clear. If you do have any questions though, please ask below or in the Idea Chamber! Let’s get started with the overview of the different chip and processor companies.

Advanced Micro Devices (AMD)

This is a 2 year weekly chart for Advanced Micro Devices (AMD). The 161.8% Target Line, or the Golden Ratio for its current uptrend was just missed. AMD is shaping up to develop a bearish candlestick pattern on this weekly chart unless its share price can close upwards of 8% or more tomorrow. Tomorrow being a Friday is the last day for a weekly candlestick pattern and the final shape.

Bullish Scenario

If you followed the insight from this previous article “2/8/2017 – Advanced Micro Devices (AMD) – One That Got Away“, you most likely sold some shares above the $15 area.

Whether or not AMD has one more push upwards is irrelevant at this time. What is relevant is to wait for a pullback to the $12 area or slightly below and look to repurchase any sold shares.

This would only be a scale-in purchase, not an all-in purchase. And only make that purchase if the selling volume is decreasing as it approaches the supporting trendline.

Any repurchased shares would then be held on a re-test of the previous high of $15.55. Once the break above $15.55 takes place, it becomes important to[s2If !current_user_can(access_s2member_level1)]….

If you want to continue reading this article for Advanced Micro Devices, Himax Technologies, Micron Technologies and nVidia Corporation (AMD, HIMX, MU & NVDA respectively), you must first login.

I review bullish and bearish scenarios for each company’s share price as well as the key items to watch for.

If you are not a Trendy Stock Charts member, consider joining today! There are several different subscription plans available.[/s2If][s2If current_user_can(access_s2member_level1)] analyze the trade again. If AMD has any chance at reaching for the 261.8% Target Line from the Fibonacci Extension Tool on the above chart, that would involve a bounce at the $12 area without any significant breach of the supporting trendline. A bounce on significant buying volume and AMD’s share price could be seeing the $22 in 6-9 months time.

Bearish Scenario

The bearish scenario involves AMD’s share price breaking support at the $12 level and continuing down to the $10 area before finding strong enough support for a bounce.

What to watch for: The pullback to the supporting trendline at the $12 area is the key. If the pullback develops on selling volume that is increasing or higher than the average daily trading volume, that would be an indicator that the $12 support area will not hold.

If the $12 area does not hold and proceeds to the $10 area, that would then signal that a Bullish Impulse wave pattern completed and the pullback to the $10 area is Wave A of some sort.

Himax Technologies (HIMX)

Himax Technologies (HIMX) was stuck in a downtrend when I was first asked to analyze the company’s stock chart. It has since rebounded and shown some bullish characteristics in its rebound.

This is a 2 year weekly candlestick chart where I’ve previously applied the Downtrend Channel Test to its chart.

Regardless of the bullish or bearish scenario, any pullback into the gray shaded box over the next couple of weeks appears to be a decent opportunity for a scale-in purchase to go long HIMX. HIMX has shows signs of price stabilization. Use any additional weakness over the next 2 weeks to enter into a long position with this stock.

Bullish Scenario

HIMX’s share price opens around the $7.20 area and by the end of the week has made a new high for the current uptrend. That would indicate a probable Bullish Impulse wave pattern where the last 3 weeks of price activity have represented Waves 1 & 2 in the pattern.

If HIMX is working on Wave 3 of a Bullish Impulse wave pattern, the green 100% Target Line from the Fibonacci Extension Tool is the short-term price target – the $8.98 area. The 161.8% Target Line is the medium-term price target.

This move would be identified by buying action early in the week and a closing share price around the $8 level by the end of the week. The $9 price target would be w 2-3 week price target.

The bullish scenario will be identified by a close above the resistance area from the Bearish Engulfing candlestick pattern that developed on February 22, 2017. This bearish reversal candlestick pattern developed on HIMX’s daily chart.

If the bullish scenario is playing out, I would anticipate a close above the resistance area no later than mid-week this upcoming week.

Bearish Scenario

The 2 Northern Doji candlestick patterns that developed on HIMX’s chart indicate the top or near top of its current rebound. A continued pullback would be on the horizon for its share price as it does not breakout from the Downtrend Channel Test this upcoming week.

Start to look for indications that the pullback is over by looking for reversal candlesticks or other signals when HIMX’s share price is in the gray shaded box. There are 2 support areas identified on this next 3 months daily candlestick chart. The bearish scenario is that HIMX’s share price drops to the lower support area and re-tests the previous low of $4.58.

Micron Technologies (MU)

This is a 3 year weekly candlestick chart for Micron Technologies (MU).

Bullish Scenario

The 3 Weeks Tight chart pattern indicate higher share prices are coming for MU. It is considered a bullish continuation chart pattern.

I placed a Fibonacci Retracement Tool on MU’s previous overall downtrend. When a stock’s share price is rebounding and breaks through the 50% Retracement Line on above average buying volume, the chances for a full retracement are greatly increased. That could mean that MU’s share price sees the $36 area in a year’s time or less.

Combine the above 2 signals and chances are good for a continued uptrend.

Bearish Scenario

A bad news event(?) happens for Micron Technologies (MU) to help slow down the ascent of its uptrend. If MU’s share price were to fall back through the 50% Retracement Line on the above chart, that would be a definite bearish signal for future price activity. Especially if the drop back through the 50% Retracement Line occurs on heavy selling volume.

This was the only bearish thing I could think of since its daily and monthly charts both look bullish as well.

nVidia Corporation (NVDA)

Both the bullish and bearish scenarios I’ve illustrated below involve corrections. The bullish scenario involves a more favorable Expanded Flat corrective wave pattern while the bearish scenario involves a more bearish Zig-Zag wave pattern.

The deeper that NVDA’s share price pushes on this current downtrend, the more likely that the ZIg-Zag corrective wave pattern develops.

The next “uptrend” for NVDA’s share price is most likely going to be a counter-trend rally in a correction, not an actual “uptrend”. A counter-trend rally means that after the little uptrend rally is over, a more bearish part of the correction takes place and catches most investors off-guard. This happens because most investors think the counter-trend rally is a new uptrend. Don’t be fooled and watch for signals of a stalled rally when playing NVDA back to the upside in the next week or 2.

Bullish Scenario

A bullish scenario for NVDA’s share price would involve a rebound starting no later than Tuesday next week. If the bullish scenario plays out, NVDA’s stare price will find support around the $88 area and look to start a rebound back towards its previous high.

Even though NVDA’s share price is correcting I believe, an Expanded Flat wave pattern allows for the top of Wave B to surpass the top of Wave 5. An Expanded Flat wave pattern typically develops at the end of massive uptrends. If this scenario plays out, you would still want to sell any purchases made next week before its next earnings report.

With a MACD Histogram that shows selling momentum is growing fast, along with above average selling volume, make sure some sort of bullish reversal signal is identified on its daily chart. That can be by using moving averages, trendlines, or a bullish reversal candlestick pattern. Either way, look for confirmation of a reversal on the daily chart if you are interested in playing the uptrend for Wave B.

With increasing selling momentum indicated by the MACD Histogram as well as selling volume that has been above average trading volume, an Expanded Flat wave pattern was about the most bullish I could get with the share price at this time.

Bearish Scenario

This 2 year weekly candlestick chart illustrates a Bullish Impulse wave pattern has completed on a larger scale. A Zig-Zag wave pattern is one of the most common corrective wave patterns. It is also more bearish than the Expanded Flat wave pattern I talked about in the Bullish scenario. The resulting share price from a Zig-Zag wave pattern will be lower than that of an Expanded Flat.

Summary

As time progresses and if things change or aren’t aligning up with expectations, stop on by the Idea Chamber and ask for an update! If the are any questions, fire them off!

Good luck trading.

On Deck: Amazon

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