Dow Jones Futures: Stock Market Rebounds; Watch Atlassian, Workday, Twilio, Tableau

Dow Jones futures fell modestly late Wednesday, along with S&P 500 futures and Nasdaq futures, after the best one-day stock market gains in more than nine years. It’s just the first day of a stock market rally, so be wary. But it’s a reminder to update watch lists for the next stock market uptrend. Here are five leading software names to watch: Atlassian stock, Twilio stock, Workday stock, Tableau stock and Okta stock.


Atlassian (TEAM), Twilio (TWLO), Workday (WDAY), Tableau Software (DATA) and Okta (OKTA) are all above their 50-day moving averages. Atlassian stock, a member of the IBD 50 list, has a relative strength line at a record high. Twilio stock, Workday stock, Tableau stock and Okta stock have RS lines at highs. The relative strength line tracks a stock’s performance vs. the S&P 500 index.

Dow Jones Futures Today

Dow Jones futures fell 0.1% vs. fair value. S&P 500 futures slid 0.2%. Nasdaq 100 futures retreated 0.3%. Keep in mind that overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular session. Dow Jones futures have been volatile recently and haven’t given clear signals of the big regular session stock market moves.

Stock Market Rally: Day 1

The stock market has been acting like a reeling boxer no longer even putting up his gloves to defend himself. But on Boxing Day, the punch-drunk boxer punched back: The Dow Jones and S&P 500 index soared 5% in stock market trading, while the Nasdaq composite rallied 5.8%.

The S&P 500 index had fallen at least 1.5% in each of the four prior sessions. As IBD noted in its Market Update video Wednesday morning, in the most recent two times that happened, the S&P 500 index rallied at least 5% the following session. That marked the bottom of the 1987 bear market. A July 2002 rebound came near the end of the 2000-02 bear market, but the actual low was in October.

Most of the best one-day stock market gains come in the midst of stock market corrections. Investors should look for continued stock market gains with a follow-through day to confirm a new rally attempt. Confirmed stock market rallies sometimes fail, but no significant uptrend occurs without one.

Atlassian Stock

Atlassian stock shot up 8.5% to 85.32 on Wednesday after finding support at the 50-day moving average on Christmas Eve. The collaboration software maker is in a cup-with-handle base with an 89.92 buy point. Atlassian earnings growth has accelerated for the past two quarters. Analysts expect a third quarter of faster growth with a 62% EPS gain in the current quarter.

Atlassian stock boasts a best-possible 99 IBD Composite Rating.

Twilio Stock

Twilio stock rocketed 13% to 85.39, soaring back above its 50-day line. The communications software specialist has had a huge run in 2018 as it turned profitable. Twilio stock does not have a valid buy point for now. But it’s definitely one worth watching. Twilio stock has a 98 Composite Rating.

Workday Stock

Workday stock rallied 8% to 153.81, rebounding from its 50-day line after four losses. The human-resources and financial-planning software maker had fallen more than 8% below a 157.22 buy point, invalidating that entry. One could argue that its 50-day support and the general bear-market conditions are extenuating circumstances. But with the stock market correction still in force, investors should avoid buying Workday stock or any other for now. Workday stock could form a new base starting with its Dec. 4 peak of 172.67 .

Workday stock has a 96 Composite Rating.

Tableau Stock

Tableau stock rallied 7.75% to 118.80. The data analytics software maker ran back above its 50-day line. Like Twilio and Workday, Tableau stock does not have a proper buy point right now.

Tableau’s earnings history is choppy, but the company delivered 310% and 488% EPS growth in the last two quarters. Revenue growth has accelerated for the last three quarters.

Tableau stock, like Atlassian, enjoys a 99 Composite Rating.

Okta Stock

Okta stock vaulted 11.3% to 59.82, reclaiming its 50-day and 200-day moving averages. The cybersecurity stock is expected to keep losing money for several quarters, though losses have been narrowing. Sales growth has been 57% to 61% in each of the past six quarters.

Okta stock has a potential 69.95 buy point in a consolidation going back to Sept. 11. Okta has a decent 81 Composite Rating, reflecting its lack of profits.


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Originally posted 2019-09-19 23:29:16.


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