This week has been a wild one in the market.
Down then up, then down, then up. While the S&P 500 was up 0.5% at the close on Thursday, the index is down -11% for the week. The Dow and Nasdaq also gained on Thursday—adding about 1% and 2.3%, respectively—but are both down for the week as well, with the Dow down -13% and the Nasdaq down -9%.
But even as the market swings wildly amid the coronavirus crisis, some of the biggest stocks may be on the rebound.
Apple (NASDAQ: AAPL), Google-parent Alphabet (NASDAQ: GOOGL, GOOG), Amazon (NASDAQ: AMZN), and Microsoft (NASDAQ: MSFT) are all deep in the red over the last month along with the rest of the market, but one expert technician says there are a few key levels to watch for that could offer an excellent buying opportunity for these stocks.
“This is where you want to pull out the playbook of, ‘Where do we really, really want to own these stocks?’” said Piper Sandler chief market technician Craig Johnson.
“If you take a look first at a chart of Microsoft, if we see this stock pull back to say the $140 or $132 level area, you’ve got a lot of support down there from a long-term chart perspective,” Johnson said. “And if you’re a long-term investor, this is where you want to buy it.”
From where MSFT is as of this writing, the stock would have to fall -1.9% to reach the $140 level, and -7.5% to hit the $132 level. And given the market’s recent moves, Microsoft shares could reach those attractive buying levels quickly.
Johnson said that Apple could be a buy if it has another downswing. According to the technician, the $225 level would present a good opportunity to buy the iPhone maker.
Apple shares haven’t traded at that level since last September, but the stock is just 8.8% above that level now.
Like Apple, Amazon and Alphabet would present good buy spots if they should fall a bit further. For Amazon, the key level is $1,700, and for Alphabet, the level to watch for is $1,000. Amazon is 10% above its buy zone now, while Alphabet would need to fall -9.5% before it would be a compelling buy.
“This is where I think it’s very critical before the washout takes place to pull that playbook out and say, ‘Hey, these are the levels where we want to step up and buy these stock’ and writing some of the puts on these names in here, I think, is a great way to do it,” Johnson concluded.