Our Pre-Earnings Discussions About The Technical Set Ups in MSFT, AMD, GOOG Were Close to the Mark... What Now for TSLA?

Mptrader Out Front: Wednesday, October 27th, 2021

Yesterday, we discussed the directional reaction potential of MSFT, AMD, and GOOG based on my near-term technical setups, which I am happy to report, proved useful and accurate. Where are these stocks now in relation to what the technical setups were telling us ahead of the news?

MSFT--  This is what my work was telling me before earnings:

Heading into earnings, MSFT exhibits a near-term pattern that indicates the current upleg from 280.25 (10/04) has unfinished business on the upside that projects into the 320-325 target zone. If my work is reasonably accurate, then MSFT will END the post-10/04 upleg in the 320-325 target zone, and reverse sharply thereafter. In other words, let's look for MSFT's reaction to earnings to morph into a "sell-the-news" scenario...

In the aftermath of earnings, we see that MSFT followed the technical script, spiking to a new ATH at 319.06 so far. Unless and until MSFT rolls over and breaks 306.00 support, we cannot rule out still higher prices for MSFT. That said, however, my work continues to argue that MSFT is in the very late innings of its post-Oct. 4th upleg (off of the 280.25 pivot low)...

AMD-- This is what my work was telling me before earnings:

AMD's report had better exceed expectations by a wide margin to sustain a positive reaction that propels AMD still higher towards my next target zone of 125-128. My pattern and momentum work indicate that AMD is unlikely to sustain initial knee-jerk strength in reaction to earnings and that we should expect selling to emerge into any post-earnings strength. Key support resides at 118.00, and if violated, will trigger sell signals in my work that will indicate the upleg from the 9/29 low at 99.81 is complete...

Into the news, AMD spiked to a new ATH at 127.20, right into my optimal upside target of 126-126 (see my attached chart), and after earnings were released, could not extend the gains, and instead has reversed moderately into the 120-122 area. A decline that breaks 118 will trigger initial sell signals in my work. As of this moment, my pattern and momentum work are warning us that the upleg from the 9/29 low at 99.81 peaked at 127.20... 

GOOG-- Here is what we discussed late yesterday ahead of earnings:

... unless GOOG's reaction to tonight's earnings propels it above resistance at 2885-2936 (3% to 5% above the current price circling 2800)-- which will project to a 3100 target, then my pattern work argues for GOOG to roll over into a corrective downleg that violates nearest support at 2725 in route to my initial target zone in the vicinity of 2600 to 2580...

In reaction to the report, GOOG failed to react positively, but on the downside, managed to hold nearest support in the vicinity of 2725, bouncing off of that area to 2778 as we speak. GOOG is betwixt and between key resistance at 2830-2885 and key support at 2725-2730, and as such, let's consider the bulls still in directional control because the sellers so far are unable to inflict any technical damage... 

Otherwise, it is interesting to me that on one hand, TSLA "failed" to close above my key big picture equidistant swing target of 1049.10 after hitting a new ATH at 1094.94, which keeps TSLA vulnerable to a sharp pullback unless and until it closes above 1049.10. My attached 4 Hour Chart shows that so far, weakness in TSLA has been contained at or above 1000, and as long as that is the case, all of the action off of the 1094.94 high should be considered a high level digestion period. A breach of 1000 will trigger a bout of weakness that projects to 900-880. 

On the other hand, after CNBC's interview with fund manager Ron Barron, TLSA's biggest shareholder, and biggest fan, coupled with an interview with the Hertz CEO Mark Fields, who announced a mega deal to buy 100,000 TSLA EVs for its rental fleet, TSLA stock remains stuck in the mud, up 19, circling 1035 (beneath my key 1049.10 closing level). This lack of umph so far after the CNBC interviews touting the greatness of Musk and TSLA suggests that TSLA needs more time to digest and possibly correct the excesses generated by its prior 4 day parabolic upmove from 888 to 1094.94... 

ES in a few minutes...