Apple Lifts Nasdaq; These 2 Chip Stocks Break Out – Investor's Business Daily

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U.S. stock indexes popped higher midday Friday as quadruple witching kicked up the volume.

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The Nasdaq advanced nearly 0.4%, while the S&P 500 and the blue chip Dow Jones industrial average added 0.1% and 0.2% respectively. The small-cap Russell 2000 rose less than 0.2%.

Volume in the stock market today was sharply higher on both major exchanges. Friday is a quadruple witching day, which involves the expiration of stock index futures, stock index options, single stock futures and stock options.

In the Nasdaq 100, chipmaker Skyworks Solutions (SWKS) rose 2% to clear a 108.65 buy point in cup-with-handle base. Volume was twice its usual pace. The cup with handle is a common bullish pattern that involves U-like action with a downward tail at the end.

Chip designer Nvidia (NVDA) also broke out. The stock cleared a 174.66 buy point in a flat base.

Among IBD’s 197 industry groups, chip groups were leading gainers. For the week, automakers, oil and chip-designer groups led the pack. Cement stocks were shaping up as the biggest losers for the week. The cement stocks have unwound a brief rebound associated with Hurricane Harvey.

Meanwhile, Apple (AAPL) stabbed 1.5% higher midday Friday in volume that was running 195% above normal. The stock broke out in early August but has moved essentially sideways in the 5% buy zone. The Street expects Apple to grow earnings 8% in fiscal 2017 ending this month and then pick up to 22% growth in fiscal 2018.

Electric car maker Tesla (TSLA), which broke out Thursday from a cup-with-handle base showing a 370.10 entry point, was protecting most of its gain.

Tesla shares edged less than 0.4% lower to 376.65.

The 5% chase zone in Tesla goes up to 388.61. Any price above that is considered extended from the proper buy point.


IBD’S TAKE: The cup with handle is one of the most important chart patterns that every growth investor can learn in order to master the timing of buying outstanding companies during a confirmed market uptrend. Learn more about this historically proven chart pattern and others by reading the Investor’s Corner archives.


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