Tesla
The Biden Administration can’t make up its mind…
Just one month ago to the day (February 18), we saw headlines that the Biden Administration was considering delaying the switch to electric vehicles. The move was partially seen as political to allay fears the Detroit automakers and the unions were having.
A month later, and now the administration is trying to do the same for the environmental side of the aisle, as the administration announces they are set to crack down on emissions in order to speed-up EV sales.
Tesla (TSLA) is one of the winners in this political tug-of-war as the stock is trading 4% higher. The company also announced a price hike for the Model Y.
Keep a close eye on Tesla shares. The stock is mired in a bearish trend that is not likely to reverse. Recent strength is likely to do little more than give the bears more room to profit from its next drop to $150.
Alphabet
Shares of Alphabet (GOOGL) are up 7% and preparing to break into new high territory after news that the company is in talks with Apple (AAPL) to add its Gemini AI engine into the iPhone.
The rally follows a sharp decline in shares following an error demoing the company’s AI chatbot in early February.
More importantly, this move takes the stock to a breakout to new highs as the next earnings season is only one month away. This is the type of activity that we have been expecting to move the “Fantastic Four” stocks into a pre-earnings “buy the rumor” rally.
I expect Alphabet shares to target a move to $160 ahead of next month’s earnings report on April 23.
Super Micro Computer
Super Micro (SMCI) stock is trading slightly lower this morning as shares are seeing volatility based on news.
First, the company is officially joining the S&P 500 today. The effect on the stock from this event should be mild, as mutual funds and exchange-traded funds (ETFs) contributed to Friday’s larger-than-normal volume as part of their rebalance.
Second, SMCI will present at the Nvidia (NVDA) GTC conference today. Expect this appearance and comments from the conference to contribute to the stock’s volatility more than the rebalancing activity.
After hitting $1,200 last week, the stock has seen selling pressure that is likely to test round-number support at $1,000. We are very likely to see investors step in to buy the shares at that price given their stock’s strong “buy the dip” nature.
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About the Author
Chris Johnson (“CJ”), a seasoned equity and options analyst with nearly 30 years of experience, is celebrated for his quantitative expertise in quantifying investors’ sentiment to navigate Wall Street with a deeply rooted technical and contrarian trading style.