Levels to watch ahead of tech earnings, according to Katie Stockton
Earnings season is in full swing this week as five of the “Magnificent Seven” companies report earnings. Alphabet (GOOGL), Amazon.com (AMZN), Meta Platforms (META), and Microsoft (MSFT) report earnings after the close on Wednesday, and Apple (AAPL) reports Thursday evening. These five stocks account for approximately 24% of the S & P 500 Index (SPX), making this a pivotal week for markets. Below are key levels to watch as earnings are digested. GOOGL is approaching final resistance from its February high, near $349. An earnings-driven breakout would generate a measured move objective of approximately $400. Overbought conditions are a potential headwind to a positive earnings reaction. However, intermediate-term momentum is improving within the long-term uptrend, so a pullback may offer an opportunity to add exposure. Initial support for GOOGL is near $311 based on the 50-day and 10-week MAs. AAPL is wound up in a triangle consolidation pattern within the context of its long-term uptrend. AAPL is not yet overbought and has a pending weekly MACD ‘buy’ signal, favoring a breakout. If AAPL decisively clears trendline resistance near $270, it would be a bullish development allowing for a measured move of about $315. In the event of an earnings-driven pullback, initial support is at the 200-day (~40-week) MA near $254, and secondary support is at the bottom boundary of the triangle near $244. AMZN is at a proving ground going into earnings since it has a chance to confirm a breakout this Friday above final resistance near $259. The stock is deeply overbought after a sharp rally, which increases the risk of a negative reaction and unconfirmed breakout. AMZN has support from a gap at $240, with a stronger zone ranging from $220 to $232, partly based on the cloud model. Despite signs of upside exhaustion, a confirmed breakout would yield an intermediate-term measured move projection of approximately $293. META is another megacap stock testing resistance ahead of earnings, having come into threefold resistance in the $680-$690 area. A breakout above this zone would target final resistance near $794 over the intermediate term, while a negative reaction would be a setback, marking another rejection at the 200-day (~40-week) MA. Initial support is at the 50-day MA near $630, and long-term Fibonacci support is near $522. MSFT has a unique technical setup as it appears to have made a significant corrective low in March, evidenced by the new weekly MACD ‘buy’ signal and recent breakout above the 50-day MA. The weekly stochastics are not overbought, and MSFT has been digesting its gains in a neutral consolidation phase. Next resistance from the weekly cloud model is near $450. The 50-day MA is now initial support near $395, and important long-term support is near $350. Earnings reactions from these names will likely set the tone for the broader market in early May given their footprint in the SPX and the proximity of key technical levels. Breakouts would reinforce the prevailing uptrend, while disappointments could trigger near-term volatility and bring support levels in focus. —Katie Stockton with Will Tamplin Access research from Fairlead Strategies for free here . DISCLOSURES: None. All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, or its parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. 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