Technical Update - Cybersecurity stocks under pressure. Can they make a come back ? Technical Update - Cybersecurity stocks under pressure. Can they make a come back ? Technical Update - Cybersecurity stocks under pressure. Can they make a come back ?

Technical Update - Cybersecurity stocks under pressure. Can they make a come back ?

Equities 5 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

Cybersecurity stocks have enjoyed strong uptrend since early 2023, with few exeptions and laggers
Corrections have hit in February/March putting the medium-term bullish picture under pressure. 

In this analysis: 

Cybersecurity ETF CIBR The technical picture for the biggest cybersecurity ETF's CIBR is explained in details in this analysis. 
In addition to that, six of the biggest cybersecurity stocks are covered in the analysis with
key support and resistance only. Reason being that the technical picture for each stock is almost similar to the CIBR ETF

Please also check out our Cybersecurity theme on SaxoTrader:

  • Check Point Software
  • Cloudflare
  • CrowdStrike
  • Fortinet
  • Palantir Tech
  • Palo Alto Networks

Cyber Security ETF First Trust Nasdaq Cybersecurity CIBR
CIBR is in a short-term corrective downtrend but has recently formed a bottom and reversal pattern (circled) around minor support at 52.45, suggesting the correction may be over.

However, for now the downtrend is intact, and a daily close below 52.45 will most likely fuel another sell-off down to around 50. The strength indicator, RSI, is currently showing negative sentiment with no divergence, suggesting CIBR could drop lower.

On the weekly chart, CIBR is in a medium-term correction phase. The weekly RSI remains in positive sentiment with no divergence, indicating that CIBR is likely to resume its uptrend and move to previous highs and higher after the correction is over.

However, key support at 51.26 must hold. A close below this level will demolish the corrective scenario and turn it into a medium-term downtrend, with downside potential to around 47. The first indication of this bearish scenario possibly playing out would be a daily close below 52.45.

A daily close above 56.57 is required for CIBR to resume its uptrend with upside potential to 62.

Source all charts and data: Saxo Group

Check Point Software  Likely to drop to support at 151-147. RSI indicating lower levels. Needs to close above 161.95 to resume uptrend. 

Cloudflare After bullish gap early February Cloudflare ahs been sliding back below lower gap boundary at 90.31 and in to negative sentiment and trend.
90.31 is now a resistance level but Cloudflare needs to close back above 97.37 to confirm uptrend. A daily close above 90.31 could get buyers trying to push the stock up there

Medium-term Cloudflare has lagged other Cybersecurity stocks. Weekly RSI is bullish however, and if Cloudflare can get back above 97.37 a push higher towards 132 is in the cards.

CrowdStrike strong support at 282. A daily close below likely sell-off to 261.80 possibly down to 238.50

Fortinet A daily close below key support at 62.63 likely leading to a sell off down to 60-57 support area.
A daily close above 68.86 uptrend will be confirmed

Palantir Tech key strong support at 20.30. Minor resistance at 22.30, a daily close above is likely to establish an uptrend that is confirmed by a daily close above 24.10

Palo Alto Networks key strong support at around 261.74, a daily close below is likely leading to a sell-off down to around 234.
A daily close above could be an indication of Palo Alto is building an uptrend.
An RSI close above 60 will confirm that scenario which could lift the stock to test the gap area 317.40

Disclaimer: Author owns shares in Cloudflare

Disclaimer

The Saxo 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 Inspiration Disclaimer and (v) Notices applying to Trade Inspiration, 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 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 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 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 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 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.

Trading in financial instruments carries risk, and may not be suitable for you. Past performance is not indicative of future performance. Please read our disclaimers:
Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
Full disclaimer (https://www.home.saxo/en-sg/legal/disclaimer/saxo-disclaimer)

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. Saxo Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Markets or its affiliates.

Saxo Markets
88 Market Street
CapitaSpring #31-01
Singapore 048948

Contact Saxo

Select region

Singapore
Singapore

Saxo Capital Markets Pte Ltd ('Saxo Markets') is a company authorised and regulated by the Monetary Authority of Singapore (MAS) [Co. Reg. No.: 200601141M ] and is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms & Risk Warning to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Trading in leveraged products such as Margin FX products may result in your losses exceeding your initial deposits. Saxo Markets does not provide financial advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Markets does not take into account an individual’s needs, objectives or financial situation.

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-sg/about-us/awards.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website are not intended for residents of the United States, Malaysia and Japan. Please click here to view our full disclaimer.

This advertisement has not been reviewed by the Monetary Authority of Singapore.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.