Technical Update - Amazon, Apple & Alphabet set top open lower but trend is up. Will it continue? Technical Update - Amazon, Apple & Alphabet set top open lower but trend is up. Will it continue? Technical Update - Amazon, Apple & Alphabet set top open lower but trend is up. Will it continue?

Technical Update - Amazon, Apple & Alphabet set top open lower but trend is up. Will it continue?

Equities 4 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

Summary:  Amazon, Apple and Alphabet all delivered disappointing earnings and guidance after market and are set to open lower. A lower open that comes after jumping higher yesterday forming gaps.
The lower open does not seem to reverse the uptrend all three companies are currently performing but the gaps are likely to be important for the direction. Which way will they be closed?


Amazon is set to open around 108.70 after earnings release yesterday after Market (indicated by the horizontal dashed line). That is around yesterday’s lows and in the gap performed during yesterday’s session. The same gap that was also created October 2022 during heavy selling pressure.
The key question is; will Amazon close the gap again to the upside i.e., will it close above 111 or to the downside i.e., will it slide lower to close below 105?
If the former there is more upside potential to around 121 short-term. Medium-term there could be potential up to resistance at around 136.45.
If closing below 105 selling pressure could push Amazon down to support at around 97.23.

However, the short-term underlying sentiment is bullish with RSI above 60 and no divergence and the 21 and 55 Moving Averages rising. This will offer some support to the share price.

Source all chart and data: Saxo Group
Medium-term weekly chart, Amazon bounced to reach the 0.50 retracement of the Q3-Q4 2022 sell-off. The bounce occurred after RSI showed divergence during that selling pressure. RSI is still showing negative sentiment however, and needs to close above to switch to positive sentiment.
If rejected at 60 threshold the bear market is likely to resume in Amazon.
But if Bulls can push Amazon higher (closing the forementioned gap) and weekly RSI to close above 60 there is room for Amazon up to around 136.45. Around the 200 weekly SMA.
If Amazon fails to break higher and bear trend resumes share price is again looking at new lows.

Apple is set to open around 148.45 after earnings release yesterday after Market (indicated by the horizontal dashed line) i.e. around yesterday’s low. And still above 200 SMA and inside the rising channel pattern.
Similar Amazon Apple created a gap yesterday. If Apple closes below the 145.90 and below the lower rising trendline it could fuel further selling down to the medium term falling trend line and support at around 133.77.
But if Apple can close back above the resistance at 149.97 as it did yesterday there is likely more upside in store. Next resistance at around 157.35 and 163.43.
RSI still showing positive sentiment support bullish scenario to continue.

Medium-term Apple is still in a down trend. Close to be testing the 55 weekly SMA. A weekly close above 153.60 will change that. If Apple can close above 153.60 RSI is likely to close above 60 i.e. back in positive sentiment indicating higher levels with potential to strong resistance at around 164.25 and 0.786 retracement at 165.
If selling pressure returns and push Apple below upper falling trendline new lows to around 118.40 should is in the cards.

Alphabet (Google) C is set to open around the resistance the share price closed above yesterday, and back below 200 daily SMA.
However, the Double bottom pattern like scenario is still valid as long as Alphabet does not close below 102.50. A close below that level the double bottom pattern is busted and selling pressure is likely to send Alphabet share price down to around 95.90. First indication of that scenario could be if Alphabet closes the gap below 101.40
Double bottom pattern has potential up to around 120 with resistance at around 112.

Medium-term Alphabet has broken bullish out of its falling channel and formed and uptrend. RSI still needs to close above 60 to confirm further upside.
55 weekly SMA will provide some resistance Resistnace at around 112.00.
If the previously mention bear scenario resumes Alphabet is likely to test its upper falling trendline in the falling channel

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)
- Full disclaimer (https://www.home.saxo/en-mena/legal/disclaimer/saxo-disclaimer)


Boulevard Plaza, Tower 1, 30th floor, office 3002
Downtown, P.O. Box 33641 Dubai, UAE

Contact Saxo

Select region

UAE
UAE

Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

Saxo Bank A/S is licensed by the Danish Financial Supervisory Authority and operates in the UAE under a representative office license issued by the Central bank of the UAE.

The content and material made available on this website and the linked sites are provided by Saxo Bank A/S. It is the sole responsibility of the recipient to ascertain the terms of and comply with any local laws or regulation to which they are subject.

The UAE Representative Office of Saxo Bank A/S markets the Saxo Bank A/S trading platform and the products offered by Saxo Bank A/S.