Apple Stock At Lows Vs. 2019 Stock Market Rally; Amazon Stock, Netflix Stock Better| Investor’s Business Daily

Dow Jones futures rose solidly late Monday, along with S&P 500 futures and Nasdaq futures. The 2019 stock market rally took a breather Monday, with the major averages falling modestly. Apple (AAPL) fell 1.5% in Monday’s stock market, though it’s still up modestly from its Jan. 3 lows. But relative to the S&P 500 index, Apple stock hasn’t made any headway, unlike large-cap techs Amazon stock and Netflix stock.




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Dow Jones Futures Today

Dow Jones futures rose 0.55% vs. fair value. S&P 500 futures climbed 0.5%. Nasdaq 100 futures advanced 0.6%. Remember that overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular session.

2019 Stock Market Rally Update

For the third straight session, the major averages retreated in the morning. On Thursday the stock market closed with slim gains and on Friday it closed fractionally lower. On Monday the major averages retreated a little more meaningfully, with the Dow Jones down 0.4%, the S&P 500 index 0.5% and the Nasdaq composite 0.9%.

The good news is that a modest pullback over a few days could allow more stocks to finish bases or form handles. After selling off for several months, many top stocks are repairing damaged charts in the recent 2019 stock market rally. A pullback also could shake out weak stock market holders before the Nasdaq and other indexes challenge the 50-day moving average.

Apple Stock

Apple stock fell 1.5% to 150 on Monday after a 1% loss Friday. Shares are still 5.6% above their Jan. 3 low of 142, when Apple plunged 10% on its grim China and iPhone warning. But the relative strength line, which tracks a stock’s performance vs. the S&P 500 index, is right at those long-term lows. (The RS line is the blue line in the charts below.)

The best you can say about Apple stock is that since Jan. 3 it hasn’t been underperforming the S&P 500 index, unlike from Nov. 1-Jan. 3. But that also means that Apple stock has bottomed in large part because of the 2019 stock market rally. If the broader stock market begins to head back toward its lows, Apple so far hasn’t shown it can resist that.

Netflix Stock

Netflix (NFLX) is the best-looking FANG stock right now. Shares of the IBD 50 component fell 1.4% to 332.94 on Monday, dipping just below their 200-day moving average. But Netflix stock has run up sharply from its Dec. 26 intraday low, with its RS line at its best levels in nearly three months. Netflix stock still has a long way to go to build a proper base, but it’s clearly showing a bottom for now.

Netflix earnings are due Thursday.

Amazon Stock

Amazon (AMZN) also retreated 1.4% on Monday, to 1,617.21. Shares found support intraday at the 50-day line and are just below the 200-day.

Amazon stock has taken the market-cap crown in recent weeks at $790.8 billion, just above Microsoft (MSFT) at $783.4 billion. Apple stock is now fourth at $709.5 billion.

Amazon’s relative strength line has risen less than that of Netflix. That’s partly due to the strength of the 2019 stock market rally. Still, the RS line has been hovering at the best levels since late October.

As with Netflix stock, Amazon stock needs to build the right side of a base before potential buy points develop.

Apple stock, Netflix stock and Amazon stock rose fractionally late.

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