Intel: 2 Charts To Justify A Neutral Approach

Market Technician and Eagle Bay Capital founder JC Parets goes over the Dow 30 stocks every week. Included in this select group is Intel Corporation (NASDAQ: INTC).

Weekly Chart

Structurally, Intel went thorough a failed breakout in January, confirming bearish momentum divergence. Eagle Bay said this was not a good signal, “and now relative strength is also back into this range from 2012-2013” that they said had been a bullish breakout.

The firm still wants to be long Intel only above the shaded area close to $35.50. Below it, they assume a more neutral stance.

Thus, the analysts prefer to approach the issue from a tactical perspective (see daily chart below).

Daily Chart

The short-term picture is a bit different.

Parets and his team only wanted to be long Intel above the September highs, with a target close to $39. Below that level, a neutral approach seems best.

“After failing to hold those levels in late January, we said that if prices consolidate a bit above the 200 day moving average, I would start to put longs on,” Parets explains. “This did not happen either and now momentum is in a bearish range hitting oversold conditions on this correction. I see little to do here with this much overhead supply and would continue to approach this from a neutral perspective.”