Intel: are we about to see a solid rebound?
Since the Covid-19 outbreak the share price has lacked recovery signs. Our chartist looks for a catalyst.
27th October 2020 09:53
Since the Covid-19 outbreak the share price has lacked recovery signs. Our chartist looks for a catalyst.
Intel Corp (Nasdaq:INTC)
Our weekly dip into the US market features Intel (NASDAQ:INTC), probably the leading computer chip maker.
In these troubling times, searching for ‘safe’ longer-term stocks is difficult. Someone recently pointed out the earnings of the top five tech shares are greater than the entire US Russell 2000 index combined, and as such are liable to weather whatever storms presidential elections, pandemics, or even the weather, throw at them.
As the Intel share price is looking a bit dodgy, we need to take a closer look!
The Covid-19 drop experienced by Intel in mid-March of this year was, from our perspective, arithmetically precise.
Unfortunately, in the months since the share has failed to achieve any real measure of recovery.
Our calculations demanded the price close a session above $64.5 (£49.5) to signal a bottom was ‘in’ and a cycle toward infinity and beyond could commence.
Or, more correctly, a run up to $74 eventually and a new all-time high.
Unfortunately, such a miracle has been noticeably absent so far, with the result that we suspect some reversals are planned for the share price.
The immediate picture is fairly boring, with weakness below $46.25 suggesting travel down to $45.7 is coming.
This is a fairly interesting movement, given the drop target level meets the uptrend for the last five years.
This alone should certainly give some hope for a bounce. Unfortunately, times are not normal, so we shall be more interested if the company discovers a reason to close a session below $45.7.
This introduces the potential for some fairly strong reversals heading Intel's way, with weakness looking probable to an initial $38 dollars with secondary, if broken, at a confident looking bottom of $30.
We'd certainly anticipate a bounce around such a level, despite a fly in the ointment.
As the visuals show, there's a blue downtrend painted on the chart, one which dates back to the year 2000.
Intel's share price broke this trend back in 2017, nudging through the barrier which was at $38 back then.
If true strength is perceived to exist within Intel, we'd be remiss not to expect a solid rebound should $38 make itself known.
Source: Trends and Targets Past performance is not a guide to future performance
Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
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