Over at TradingWithWaves.com we help traders leverage our Decision Support Engine (DSE) to improve their trading. This update is based on the information we share with members of our programs on a regular basis. First we’ll get an overview of the market by looking at SPX and then we’ll take a look at five tech (IBM, AAPL, TSLA, MSFT, and AMZN) stocks and where they’ll be heading.

1. Trading insights into five
tech stocks
Insights from the TradingWithWaves DSE to help your trading

2. First some context – over at
TradingWithWaves.com we help traders
leverage our Decision Support Engine
(DSE) to improve their trading. This
update is based on the information we
share with members of our programs on
a regular basis. First we’ll get an overview
of the market by looking at SPX and then
we’ll take a look at five tech (IBM, AAPL,
TSLA, MSFT, and AMZN) stocks and
where they’ll be heading.

3. The Spx chart shows the
blue path crashing from the
'07 peak to the '09 trough,
then rising out of the ashes
of the greatest financial
system implosion since the
1929 crash and Great
Depression. The red
channel lines show the
initial strength off the '09
lows was broken by the '11
decline. That initial, lower
channel line has since acted
at resistance, perfectly
reversing each rally attempt
to return above it; until this
last rise from the June
low. Note the lower highs
again in the stochs vs.
higher highs in price; the
telltale divergence that
often precedes
peak/reversals.
SPX

4. Weekly stochs (not shown) haven't been this oversold since '06,
and daily stochs (not shown) have already crossed up as of last
week. The lower 2 sdb was tested last week, with a few days of
prices closing below that statistical extreme, and have closed
back above it this week. DSE tells us to expect at least a test of
the low 200′s, with potential for the white path to allow a test of
250 in the coming months, and NOT to be short at this time. In
fact, long is suggested, as long as 172 holds as a stop loss.
IBM

5. AAPL which reported on 10/28 after the close and plunged from the
529 close to 503 on the initial announcement of its earnings, then
screamed to 542, before falling again to 515, then rising to 538, falling
to 523, talk about drama. You can see in the chart AAPL appears to be
stabilizing in the 530′s, after bouncing all over the place since its
earnings announcement. 550 is the upper 3 sdb, and 582 is the upper
4 sdb. From one of these levels, a significant decline should follow.
AAPL

6. TSLA
TSLA is approaching a short
term low. The pattern off the
recent highs is not clearly
impulsive, this 160 area is ideal
to take profits on shorts from
higher levels, and tighten buy
stops if you want to remain
short. Above 171 would not be
supportive of the bearish case,
and in fact would support at
least a small long exposure for a
test of 190. The chart shows
the loss of momentum between
waves iii.'3 and iii.'5 using sdb's
(standard deviation bands), and
weekly and monthly stochs
(neither shown) are both in
"hard down" position. As the
lower right comment in the
chart notes, parabolic rises
ALWAYS return to the origin of
the parabola, which is in the
50′s in this case.

7. MSFT is peaking a large corrective structure
that was born out of the '08 low near 15,
which is part of the giant corrective
structure born at the Dec. '99 peak. This
monthly bar chart notes my comments at
the University of North Carolina (Chapel
Hill), where I gave a week-long seminar on
objective decision support modeling. Then,
msft was the darling, and trading above
100 (pre-split) for the first time in history.
The '09 low tested the "origin of the
parabola", but the forecast for a new low in
coming years will better fulfill it. As seen at
the '07 and '01 highs, this upper 30′s zone
is NOT the place to be holding a lot of long
msft exposure, nor adding to positions.
Rather, this is the place to exit, reduce
leverage, and await the herd's coming
fulfillment of this long term pattern, likely
in the 12 +/-3 zone in the coming 3-5 years.
MSFT

8. AMZN is trading wildly, with 10 points
swings every 15 minutes, but the upper
300′s are about to be tested, with 385 as
the upper 5 sdb and 405 as the upper 6
sdb. Both will have moments to enjoy
those extremes, as it's statistically
impossible to maintain those stretches for
long. Like the internet stocks of '99, the
attraction was their lack of earnings,
allowing our puny human brains to
fantasize at the extremes of delusion.
AMZN