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 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.”