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