Stocks

Shares of Tesla Inc. (TSLA) have been decidedly rangebound over the last two months, bouncing between support around $220 and resistance at $290.  The recent price action, as well as the momentum characteristics, have confirmed this sideways trend for TSLA.  How the stock exits this consolidation phase could make all the difference!

Today we’ll look at this intriguing technical setup, show how changes in momentum could confirm a new breakout phase, and describe how we can use a “stoplight” technique to better define risk and reward for this leading growth stock.

It’s Definitely Time to Go Fishing

Jesse Livermore famously said, “There’s a time to go long, time to go short, and time to go fishing.”  And were he alive today, I think the chart of Tesla would definitely elicit a “time to go fishing” mindset for Livermore.  With the stock bouncing consistently between clear support and clear resistance, this appears to be in a straightforward consolidation phase.

After peaking in December 2024 around $480, TSLA dropped to a March 2025 low around $220.  From there, the price has rotated between the 200-day moving average as resistance and that $220 level as support.  To be clear, the countertrend rallies in March and April have been impressive, but they have not yet provided enough upside pressure to propel Tesla back above the crucial 200-day moving average.

Momentum Indicators Confirm the Sideways Trend

As we love to highlight on our daily market recap show, RSI can be such a valuable tool to assess the interplay between buyers and sellers.  During a bullish phase, the RSI usually ranges between 40 to 80, as dip buyers use pullbacks to add to existing positions.

We can see this pattern from June 2024 through the end of January 2025, as the RSI remained above 40 on pullbacks within the bullish trend phase.  Then in February 2025, the RSI pushed below 40 as TSLA broke below its 50-day moving average.  We’ve color-coded this section red, showing how the entire range of the RSI drifted lower during a clear distribution phase.

Over the last six weeks, the RSI has been in a tight range between 40 and 60.  As the price of Tesla has remained rangebound, the momentum readings suggest an equilibrium between buyers and sellers.  Until the RSI breaks out of its own sideways range, the chart is suggesting we wait for new information to change the picture.

A Breakout Above $290 Would Suggest a Bullish Resolution

So if we apply a “stoplight technique” to the chart of Tesla, we can better visualize how we might approach this stock from a technical perspective as we negotiate an end to this consolidation pattern.

If we see a positive resolution to the pattern, and TSLA is able to finally clear price resistance and the 200-day moving average around $290, that would indicate a new accumulation phase with further upside potential.  A break below $220, on the other hand, would suggest a lack of willing buyers at support and most likely a new distribution phase.  

And as long as TSLA remains below $220 and $290, then Jesse Livermore would suggest we “go fishing” instead of taking a shot at an underwhelming chart!

One more thing…

I’ve heard from many investors that struggle with selling too early, leaving potential future gains on the table.  Is there anything more painful than that?  My recent video may give you some ideas of how to address this in your own investment process.

RR#6,

Dave

PS- Ready to upgrade your investment process?  Check out my free behavioral investing course!

David Keller, CMT

President and Chief Strategist

Sierra Alpha Research LLC

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice.  The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.  

The author does not have a position in mentioned securities at the time of publication.    Any opinions expressed herein are solely those of the author and do not in any way represent the views or opinions of any other person or entity.

Today, Carl and Erin made a big announcement! They are retiring at the end of June so today was the last free DecisionPoint Trading Room. It has been our pleasure educating you over the years and your participation in the trading room has been fantastic! Be sure and sign up to follow the DecisionPoint Blog on StockCharts.com where we do plan to publish articles periodically. (Subscribers: you will be notified via email as to how your subscription will be handled. Stay tuned.)

After the big announcement, Carl opened the show with the DP Signal Tables to give us a sense as to the market’s overall trend and condition.

Carl then went through his regular market overview that included Bitcoin, Bonds, Yields, Crude Oil, Gold, Gold Miners and the Dollar.

Once finished with the market overview, Carl walked us through the Magnificent Seven in the short and intermediate terms by looking at both the daily and weekly charts.

The pair took questions including a discussion on relative strength using the Silver Cross Index and Golden Cross Index.

Erin took the controls and went through the 26 indexes, sectors and industry groups that have under the hood indicators. She walked us through the CandleGlance and explained her findings along the way.

Questions popped up again with Carl discussing his strategy of using dividend paying stocks in retirement. He mentioned the Dividend Aristocrats and Dividend Kings lists as a great source to find good dividends. Also a shout out to The Bahnsen Group ETF (TBG).

Erin finished by looking at viewer symbol requests.

It has been a great run learning and teaching about technical analysis. Thank you again for your support over the years!

01:10 DP Signal Tables

03:48 Market Overview

16:18 Magnificent Seven

22:53 Questions (Relative Strength with Silver Cross and Golden Cross Indexes)

29:18 Sector Rotation and Market CandleGlance

34:57 Question regarding dividend paying stocks

39:51 Symbol Requests

Technical Analysis is a windsock, not a crystal ball. –Carl Swenlin

(c) Copyright 2025 DecisionPoint.com

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

DecisionPoint is not a registered investment advisor. Investment and trading decisions are solely your responsibility. DecisionPoint newsletters, blogs or website materials should NOT be interpreted as a recommendation or solicitation to buy or sell any security or to take any specific action.

Helpful DecisionPoint Links:

Trend Models

Price Momentum Oscillator (PMO)

On Balance Volume

Swenlin Trading Oscillators (STO-B and STO-V)

ITBM and ITVM

SCTR Ranking

Bear Market Rules

Real Estate and Healthcare swapping positions in Top 5

The top five sectors show remarkable stability, with Consumer Staples, Utilities, Financials, and Communication Services holding steady in the top four positions.

The only change is Real Estate replacing Health Care. This shift underscores the ongoing defensive tilt in the market.

In the bottom half of the ranking, Materials and Consumer Discretionary swapped positions.

(1) Consumer Staples – (XLP)(2) Utilities – (XLU)(3) Financials – (XLF)(4) Communication Services – (XLC)(6) Real-Estate – (XLRE)*(5) Healthcare – (XLV)*(7) Industrials – (XLI)(9) Materials – (XLB)*(8) Consumer Discretionary – (XLY)*(10) Energy – (XLE)(11) Technology – (XLK)

Weekly RRG

Looking at the weekly Relative Rotation Graph (RRG), we observe ongoing strength in Consumer Staples and Utilities. Both sectors are advancing further into the leading quadrant and continue to gain on the RS ratio axis.

Real Estate is also making a notable move deeper into the leading quadrant. Financials and Communication Services are positioned on the brink of the weakening quadrant. However, they are still sustaining elevated RS ratio levels, which keeps them securely in the top five — at least for now.

Daily RRG

Consumer Staples and Utilities: Both reside within the weakening quadrant, but at high RS ratio levels. This combination, along with their strength on the weekly RRG, keeps them well inside the top five.

Communication Services: Moved into the lagging quadrant but with a very short tail close to the benchmark. This positioning allows it to remain in the top five — for now.

Financials: Similar to Communication Services, close to the benchmark with a slightly longer tail but not showing significant loss of relative strength.

Real Estate: Made a significant move, pushing into the leading quadrant on the daily RRG, combining with its strong weekly tail to secure its spot in the top five.

Consumer Staples

The Consumer Staples sector remains range-bound on the weekly chart, causing relative strength to stabilize.

With RRG lines at high levels, we might see some consolidation in the coming week — something to keep an eye on.

Financials

Financials are picking up steam again, closing in the upper half of last week’s bar.

This price strength is helping the relative strength line remain well within its rising channel.

If the sector can maintain this momentum, it’s likely to stay among the top performers.

Utilities

Utilities are trading within their sideways channel, continuing to push relative strength against (or just above) resistance.

This strength is keeping the RRG lines above 100. However, imho, we’ll need to see more relative strength in the coming weeks to keep Utilities at the top of the list.

Communication Services

Communication Services had a strong week, closing at the top of its range against former support, now acting as resistance.

Based on the price chart, we might expect some resistance and difficulty for the sector to move higher this week.

Despite this, the relative strength line remains within its rising channel, albeit losing some relative momentum at high RS ratio levels — not concerning at this time.

Real Estate

Real Estate — the new entrant in the top five — is benefiting from a strong bounce off the $36 low two weeks ago.

It’s now starting to push relative strength higher, although not yet extremely strong.

The RS momentum line is beginning to roll over while dragging the RS ratio higher.

For now, the combination of daily and weekly relative strength has been enough to displace Health Care and secure Real Estate’s spot in the top five.

Portfolio Performance

The defensive positioning of our portfolio has put a dent in performance relative to the broader market.

We’re now trailing the S&P 500 by almost 3%. However, we’ve seen over the past few weeks that these differences can equalize rapidly when the market moves in the direction of the portfolio.

So, I’m not too concerned at the moment — it’s all part of the ebb and flow of market dynamics.

#StayAlert and have a great week –Julius

The Zweig Breadth Thrust for the S&P 1500 triggered on Thursday as stocks surged last week. In poker terms, this thrust signals an abrupt participation shift as stocks move from folding to all-in within ten days. A bullish thrust signal is only part of the puzzle. How do we know when this signal fails? Today’s report will look at the ZBT signal in the S&P 1500 and offer an exit strategy. Stick around to the end for an offer to access a fully quantified strategy based on the Zweig Breadth Thrust.

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TrendInvestorPro subscribers have access to three timely reports. The first report/video explains the mechanics of the original NYSE-based Zweig Breadth Thrust indicator and then shows a modern version using S&P 1500 Advance-Decline Percent. Second, we also presented a trading strategy using ZBT signals for entry and another indicator for exits. The third report/video covers the setups and thrust signals for the percent above SMA indicators. Some of these indicators also triggered this week, but not all. Click here to take a trial and get full access.

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ZBT Triggers for S&P 1500, but Not S&P 500

The first chart shows the Zweig Breadth Thrust (ZBT) indicator triggering bullish as it moved from below -20% to above +23% within ten trading days (blue line). This thrust signal means S&P 1500 advance-decline breadth became oversold with strong selling pressure and then recovered in dramatic fashion with a surge in upside participation. Moreover, this shift occurred within a 10 day window. This reversal of fortune was both sudden and sharp.

Note that the Zweig Breadth Thrust triggered an epic signal in November 2023, and we were on it. See this report (11-November-2023) for details on the original NYSE-based Zweig Breadth Thrust. See this report (18-November-2023) for details on using S&P 1500 Advance-Decline Percent to create a Zweig Breadth Thrust indicator.  

S&P 500 ZBT Falls Short

The ZBT indicator for the S&P 500 did not trigger. The indicator was below -20% on April 8th and did not make it back above +23% within the 10 day window. In fact, the indicator did not make it back above +23% this week. This shows less upside participation within the S&P 500, and more upside participation within the S&P 1500. Small and mid cap breadth outperformed large-cap breadth this week.

Where’s the Exit?

The Zweig Breadth Thrust is only used for bullish signals, which means chartists must find another indicator to signal a failed thrust. As its name implies, a thrust is a strong upward move that is powerful enough to foreshadow an extended advance. The Zweig Breadth Thrust in November 2023 provides a classic example as SPY continued higher, never looking back. The blue line shows when both the S&P 1500 and S&P 500 ZBT indicators triggered in early November.

Chartists looking for an exit strategy can consider prior support levels based on reaction lows (troughs). The horizontal blue lines show these support levels, starting with the late October 2023 low. SPY forged a reaction low in January 2025, hit a new high in February and then broke support to trigger an exit. Current support levels are based on the April lows.

Chartists looking for a more dynamic approach can consider a trend-following indicator, which we will explore next (subscribers). This strategy is fully disclosed and quantified with backtest results. Click here to take a trial and get immediate access! 

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Following a strong move the week before, the markets took on a more consolidatory look over the past five sessions. Following ranged moves, the Nifty closed the week on just a modestly positive note. From a technical standpoint, the Nifty tested a few important levels on both daily and weekly charts. However, the trading range narrowed. The Index oscillated in a 517.60-point range over the past week. The volatility surged again; the India VIX spiked 10.93% to 17.16. The headline index went on to close with a modest weekly gain of 187.70 points (+0.79%).

The coming week is shortened, with Thursday being a trading holiday due to Maharashtra Day. We could write about more than one thing that the markets could be worried about over the coming days. It could be the lowered growth forecasts by the IMF that include India and other economies; it could also be the heightened possibility of escalating geopolitical tensions between India and Pakistan. However, all that said, the markets are also at a crucial technical juncture. The Nifty has closed just at the 200-DMA placed at 24050. Besides this, Index has also defended the 50-week MA at 23925. This makes the 23,900-24,050 zone a crucial support area for the Nifty. The consolidation is imminent as the Nifty has rebounded over 11% from its April 07 lows, and minor corrective retracements cannot be ruled out. However, if 23900 is breached, the markets may see some extended retracements.

The weekly RSI is at 55.46; it stays neutral and does not show any divergence against the price. The weekly MACD is bullish and stays above its signal line. A candle resembling a Shooting Star has emerged, increasing the likelihood of consolidation. Importantly, any candle formation should not be traded in isolation and must be used in conjunction with the overall technical setup.

The pattern analysis shows that the Nifty has defended the 50-week MA placed at 23925. The Index has also tested a rising trendline resistance; it violated this trendline support on its way down, and now this is expected to act as resistance. Overall, the zone of 24050-23900 is a crucial support zone for Nifty. If the level of 23900 is violated, it can lead to incremental weakness.

Overall, the technical structure of the market suggests that it is time for one to focus more on protecting gains at higher levels. While there could be some reactions by the markets due to external factors, the underlying buoyancy stays intact. The only thing to be cautious about is the natural corrective retracements that the market may experience following the steep upward move that has taken place. Investors must keep fresh purchases should be kept in low-beta stocks that have strong relative strength. With sector rotation visible, a cautious outlook is advised for the day.

Sector Analysis for the coming week

In our look at Relative Rotation Graphs®, we compared various sectors against CNX500 (NIFTY 500 Index), which represents over 95% of the free float market cap of all the stocks listed.

Relative Rotation Graphs (RRG) show the Nifty PSU Bank Index has rolled inside the leading quadrant. The Consumption, Commodities, Financial Services, Infrastructure, Metal, and Nifty Bank Indices are also inside the leading quadrant. While the weakening of Relative Momentum is seen in the Metal and Financial Services Index, they are likely to outperform the broader markets relatively.

The Nifty Services Sector Index has rolled inside the weakening quadrant.

The Midcap 100 and the Realty Index are showing strong improvement in their Relative Momentum while staying inside the lagging quadrant. The IT and the Auto Index continue to languish inside the lagging quadrant.

The Media Index has rolled inside the Improving quadrant, indicating a likely beginning of its phase of relative outperformance. The Nifty PSE, Energy, and FMCG Indices are also inside the improving quadrant.

Important Note: RRG™ charts show the relative strength and momentum of a group of stocks. In the above Chart, they show relative performance against NIFTY500 Index (Broader Markets) and should not be used directly as buy or sell signals.  

Milan Vaishnav, CMT, MSTA

Consulting Technical Analyst

www.EquityResearch.asia | www.ChartWizard.ae

In this video, after last week’s sharp market rally, Mary Ellen breaks down where the markets stand now, which leading sectors are showing the most strength, and how to recognize if your stocks are entering a new uptrend. Get expert insights on market leadership, sector rotation, and key signals to watch as momentum builds in specific areas of the market. This is a must-watch for investors looking to stay on top of current stock trends and spot early breakout opportunities.

This video originally premiered April 25, 2025. You can watch it on our dedicated page for Mary Ellen’s videos.

New videos from Mary Ellen premiere weekly on Fridays. You can view all previously recorded episodes at this link.

If you’re looking for stocks to invest in, be sure to check out the MEM Edge Report! This report gives you detailed information on the top sectors, industries and stocks so you can make informed investment decisions.

After weeks of uncertainty, the stock market finally gave us something to smile about. The major indexes just wrapped up four straight days of gains, and optimism is starting to creep back in. Could this be the shift we’ve been waiting for?

Let’s break it down.

The big concerns this week were all about tariffs and the potential removal of Fed Chairman Jerome Powell. But markets breathed a sigh of relief when it looked like tensions might ease between the two largest global economies. Plus, Powell staying put at the Fed helped calm some nerves.

In short, the fear factor took a breather, and the bulls took charge.

What Are the Charts Telling Us?

The S&P 500 ($SPX) crossed above the key 5500 level. This isn’t just any number; it’s a major line in the sand. It represents the March low and, if you go further back on the daily chart below, it has been a support and resistance level for previous price action. The purple horizontal line marks the 5,500 level.

FIGURE 1. SIGNS OF A TURNAROUND? The S&P 500 closed above the key 5,500 level, a major breakthrough. Breadth indicators are suggesting expanding bullish participation. Chart source: StockCharts.com. For educational purposes.

Even better, market breadth is improving.

The Bullish Percent Index (BPI) for the S&P 500 is at 65% — a solidly bullish reading.The Advance-Decline Line is trending higher.The percentage of S&P 500 stocks trading above their 200-day moving average is beginning to display increasing bullish participation.

We are also seeing strength across the board:

BPI readings for the Nasdaq 100, S&P 100, S&P 500, and Dow Industrials are all above 50%.10 of the 11 S&P 500 sectors have BPIs above 50%, with Consumer Staples being the only one with a BPI below 50. This is surprising since it was one of the only sectors above 50% not long ago.

Sector Watch: Who’s Leading?

If you’re looking for clues about the market’s next big move, watch sector rotation. Right now, leadership is coming from:

TechnologyConsumer DiscretionaryCommunication Services

These are your classic “risk-on” sectors—if they’re leading, that’s typically a bullish sign.

What About Bonds, Gold, and the Dollar?

Some of the big-picture trends are starting to stabilize, too:

Bond yields are dipping, which is helping bond prices recover.Gold pulled back after hitting new highs.The U.S. dollar is showing signs of strength again.And the $VIX—Wall Street’s fear gauge—is finally back below 30.

All small signs, but they add up.

Indicator of the Week: The Zweig Breadth Thrust

One indicator all technical analysts should take note of is the Zweig Breadth Thrust indicator.  It’s a rare signal that flashes when market breadth shifts quickly from bearish to bullish.

The indicator is the 10-day exponential moving average (EMA) of net NYSE advances. The NYSE Breadth Thrust signal fires when the indicator moves from below 0.40 to above 0.615 in 10 days.

The weekly chart below shows that this is the third time the Zweig Breadth Thrust signal was fired in the last five years. The last two times this occurred were in 2023, when the NYSE recovered after dipping below its 40- and 150-week simple moving average (SMA). This time, the index bounced off its 150-week SMA.

FIGURE 2. ZWEIG BREADTH THRUST FIRES A REVERSAL SIGNAL. Previous signals have been followed by bullish moves in the NYSE. Will we see a similar scenario this time? Chart source: StockCharts.com. For educational purposes.The Zweig Breadth Thrust is a bullish reversal signal. Note that each time the signal was fired, the market moved higher. It doesn’t guarantee a bull run, but it’s a green flag.

What’s Coming Next Week?

If this weren’t a headline-driven market, I would be more confident about the possibility of the market moving higher. Next week is packed with potential market-moving headlines.

Big Tech earningsQ1 GDPPCE Inflation data (the Fed’s favorite inflation gauge)ISM ManufacturingNon-Farm Payrolls

At the Close

The underlying market conditions are improving and some key signals are flashing green. But, as noted, it’s still a headline-driven market, and that means all the more reason to stay alert. Focus on leading sectors, watch for confirmation in breadth, and keep your investment plan tight.

End-of-Week Wrap-Up

S&P 500 up 4.59% on the week, at 5525.21, Dow Jones Industrial Average up 2.48% on the week at 40,113.50; Nasdaq Composite up 6.73% on the week at 17,382.94.$VIX down 16.22% on the week, closing at 24.84.Best performing sector for the week: TechnologyWorst performing sector for the week: Consumer StaplesTop 5 Large Cap SCTR stocks: Palantir Technologies, Inc. (PLTR); Rocket Lab USA, Inc. (RKLB); Robinhood Markets, Inc. (HOOD); Rubrik, Inc. (RBRK); MicroStrategy, Inc. (MSTR)

On the Radar Next Week

Earnings season continues with Meta (META), Microsoft (MSFT), Apple (AAPL), Amazon (AMZN), and others reportingMarch JOLTs Job OpeningsQ1 GDP Growth RateMarch PCEApril ISM ManufacturingApril Non-Farm Payrolls

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your personal and financial situation, or without consulting a financial professional.

The S&P 500 index managed to log one of its strongest weeks in 2025.  Short-term breadth conditions have improved, and the crucial 5500 level has now been broken to the upside.  Are we in the later stages of a countertrend rally, or just in the early innings of a broader recovery for stocks?  Let’s review three key charts together and evaluate the evidence.

Trendline Break Suggests Further Short-Term Strength

My daily chart of the S&P 500 has featured a thick pink trendline since March, when a lower peak around 5800 provided a perfect opportunity to define the downtrend phase.  With the quick reversal off the early April low around 4850, the SPX has finally broken back above this trendline.

To be clear, after a breakout of this magnitude, I’m always looking for confirmation from the following day.  Will additional buyers come in to push this chart even further to the upside?  Assuming that’s the case, then I’m immediately drawn to a confluence of resistance in the 5750-5850 range.

The 200-day moving average is currently sitting right around the late March peak, and both of those levels line up well with a price gap back in November 2024.  If the S&P 500 can finally break above that resistance range, I would expect much further upside for risk assets.

Breadth Conditions Confirm Short-Term Market Strength

One of the biggest improvements I’ve seen coming out of the early April low is the upgrade in short-term breadth conditions.  The McClellan Oscillator has broken back above the zero level, most days this week saw more advancers than decliners, and the Bullish Percent Index has definitely improved.

In the bottom panel, we can see that the S&P 500 Bullish Percent Index has risen from a low just above 10% at the April low to finish this week at 64%.  That confirms that over half of the S&P 500 members generated a point & figure buy signal in the month of April!

But the middle panel shows the real challenge here, in that long-term measures of breadth are still clearly in the bearish range.  Only 35% of the S&P 500 stocks are above their 200-day moving average, similar to the S&P 500 and Nasdaq 100.  Only if this indicator can push above the 50% level does the S&P 500 stand a real chance of sustainable gains above 5750.

The Stoplight Technique Lays Out a Clear Playbook

I love to overlay a “stoplight” visualization on a chart like this, helping me clarify how I’ll think about risk depending on where the S&P 500 sits at any given point.  

I would argue that a confirmed break above resistance at 5500 brings the S&P 500 chart into the “neutral” bucket.  In this way, we’re respecting the fact that a rally from 4850 to 5500 is a fairly impressive feat, but also acknowledges that the SPX remains below its most important long-term trend barometer, the 200-day moving average.

If we see further gains in the weeks to come, the SPX may indeed push into the bullish range, which for me would mean a push above 5750-5800.  In that scenario, the S&P 500 would be clear of its 200-day moving average, and I would feel much more comfortable adding risk to the portfolio.  Until and unless we see that upside follow-through, I’ll remain comfortably defensive.

RR#6,

Dave

PS- Ready to upgrade your investment process?  Check out my free behavioral investing course!

David Keller, CMT

President and Chief Strategist

Sierra Alpha Research LLC

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice.  The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.  

The author does not have a position in mentioned securities at the time of publication.    Any opinions expressed herein are solely those of the author and do not in any way represent the views or opinions of any other person or entity.

This week will be the biggest week of earnings season and yes, all eyes will be on the heavy-hitters: META, AMZN, MSFT, and AAPL. These names dominate headlines, and their charts are practically seared into our brains.

But let’s look at some solid companies that might fly under the radar but deserve some attention.

First Up, Coca-Cola Co. (KO)

KO shares have been a safe haven and steady gainer during these uncertain times. Shares are up over 15.5% year-to-date as the consumer staple giant and Warren Buffett’s favorite stock outperforms the overall market.

However, coming into this week’s earnings release, momentum seems to be fizzling out. Shares of rival PepsiCo. (PEP) missed the mark and traded lower. The biggest component of the Consumer Staples Select Sector SPDR ETF (XLP), Procter & Gamble (PG), also fell after mixed results.

Last week, investors shifted back into Technology and Consumer Discretionary and away from Consumer Staples. Shares of KO also fell as a result and now sit at an interesting level heading into its earnings release.

FIGURE 1. DAILY CHART OF COCA COLA CO. Note the saucer pattern.

Technically, shares had formed one of my favorite reversal patterns over the last year—a saucer bottom. This saucer bottom did not resolve to the upside and got faked out on “Liberation Day”. That drop quickly reversed as shares again tried to break out from this pattern. Yet again, they are struggling to do so as momentum wanes.

The safe trade in KO has lost momentum on each rally, as seen in the lower highs of its relative strength index (RSI). This bearish divergence is cause for concern as price hits a crossroads into earnings.

The upside move may be limited for now, and shares could retreat to between $67 and $70. After last quarter’s report, shares broke out to the upside and climbed higher. It will be critical for the bulls to see shares stay above $71/$72 for a continuation of this recent run.

For now, the stock has fallen flat, and if the rotation back into tech continues, it may take time for KO to take another leg higher.

Next Up, Visa, Inc. (V)

V has been another outperformer relative to its sector and the overall market. Shares are up 6.1% year-to-date and 22% over the last 52 weeks.

What should investors watch for in Tuesday’s report? Consumer spending, especially in travel and dining—areas where Visa often sees the most activity. Have investors changed their tune given tariff uncertainty and potential price swings, or have they rushed to spend due to any potential increases?

FIGURE 2. DAILY CHART OF VISA, INC. The stock is holding key support level but is making lower highs.

Technically, we are looking at a two-year daily chart to show the longer-term uptrend. That helps us put the recent weakness in perspective. Shares have declined 17% from their peak, but the sell-off was mostly orderly and took shares back to their rising 200-day moving average.

Shares were able to hold that key support area but have consistently made lower highs since its February peak. It also sits at its 50-day moving average, which is also starting to turn over. So things are at a near-term crossroads.

Clearly, earnings will be the catalyst to help shares make their next move. The moving average convergence/divergence (MACD) has triggered a buy signal and reached its lowest levels in two years. That is a positive development and could lead to an upswing that breaks the recent trend and gets shares back on a path to new highs.

Last, But Not Least, Intercontinental Exchange Group (ICE)

ICE, the parent company of the NYSE, has benefited from market volatility and expanding trading volumes. Shares are up 6.1% year-to-date and over 21% over the last 52-weeks.

FIGURE 3. DAILY CHART OF ICE. The stock price may face some headwinds, but a break above $167 will be positive for the stock.

Shares had been on a tear before mid-March. Then the market turned and took ICE shares with it. However, the sell-off took shares to critical technical levels where they held. The stock closed under its 200-day moving average for six days on its last trip below the level. Ironically, it did the same thing in early January and then rallied.

Now that the big test of the long-term uptrend was successful again, we head into earnings hoping it can build from this level. A risk/reward set-up is quite favorable if we use a level just under the 200-day for a stop loss.

The upside has minor challenges as well, but the path of least resistance looks higher. Any gap or rally over $167 should lead to a momentum surge higher. Its MACD just triggered a buy signal, and a solid earnings report should take shares to their old highs.

Final Thoughts

While the big tech names will dominate the headlines this week, it’s often the lesser-watched stocks that quietly outperform. KO, Visa, and ICE all have compelling stories and interesting technical setups going into earnings. If you’re looking for opportunities beyond the big tech stocks, these could be worth a closer look.

In this video, Grayson highlights the crucial 5,500 level on the S&P 500 using our “Tactical Timing” chart. He then demonstrates two of the easiest methods for identifying the strongest stocks within key indexes like the S&P 500, NASDAQ 100 and Dow Industrials. He’ll show you how to find leading stocks that are moving higher using the New Highs feature of the Market Summary dashboard. From there, Grayson explores the Index Members page, and explains how to sort by SCTR rankings to quickly pinpoint the strongest stocks within any major index.

This video originally premiered on April 25, 2024. Click on the above image to watch on our dedicated Grayson Roze page on StockCharts TV.

You can view previously recorded videos from Grayson at this link.