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Stock Market Today: Apple Strong, Square Eyes 5th Up Week; Why Biotechs Aren’t Dead Yet | Stock News & Stock Market Analysis

Square (SQ) edged higher in tandem with the major indexes on a holiday-shortened session on Black Friday.

The stock, as noted in the latest Big Picture column, has violated an upper channel, signaling that a correction could arrive soon.

XAutoplay: On | OffThe upper channel break does not at all mean that a major top is in a stock, but notice on a weekly chart how the fast-growing point-of-sale technology disrupter is seeing a vertical-like rise in share price.

No stock can maintain such a parabolic move forever, so holders should expect a new base to form.

The latest base that Square formed was excellent in quality. The seven-week flat base showed tight closes, controlled weekly price swings, and a mild 14% drop from head to toe. Square bolted out of that base at 28.07 in heavy turnover during the week ended Sept. 15.

The Nasdaq composite, S&P 500 and Dow Jones industrials all posted gains of around 0.2% to 0.3% in midday trading. Retail and consumer spending-related shares are helping hoist some equity indexes into new high ground on reports of busy activity at retail chains.

The Nasdaq and NYSE both close at 1 p.m. ET.

Apple (AAPL), meanwhile, edged a bit higher, extending its gain from a new breakout past a good cup with handle with a 160.97 buy point to nearly 9%.

The iPhone maker, which typically sees its biggest sales during the October-to-December holiday quarter, is also up nearly 12% from an Aug. 2 breakout past a 156.75 entry in a flat base. Shares had rallied moderately, then did a round trip of gains in late September.

Watch to see if analysts boost their estimates for Apple.

Currently, the consensus view for the fiscal first quarter, ending in December, is for a 12% rise in profit to $3.77 a share on a 10% jump in revenue to $86.2 billion.

Given that Apple tends to provide conservative guidance, chances are strong that Apple will mark a fourth quarter in a row of double-digit EPS growth. That’s the kind of stuff that fund managers love.

Earnings rose 2%, 11%, 18% and 24% in the prior four quarters. Such acceleration in the growth rate also gets institutional investors’ hearts pounding.

In the Dow Jones industrial average, only one of the 30 components gained 1 point or more: payments processor Visa (V), up 1% to 111.94. The megacap global consumer spending play is up 43% since Jan. 1 and has rallied as much as 34% after breaking out of a well-formed flat base with an 84.06 entry on Feb. 3.

In most cases, it’s smart portfolio management strategy to take at least partial profits when a stock has risen 20% to 25% past a proper entry. However, in those stocks in which you have ironlike conviction, it’s perfectly fine to hold for bigger gains, especially when the stock is not showing any clear defense-type sell signals.

Meanwhile, the medical sector has been sitting in the back seat of a tech-driven rally in recent months. However, genetics-focused biotechs continued to attract institutional money.

Editas Medicine (EDIT) and Bluebird Bio (BLUE) both show outstanding relative performance, rising 62% and 173% year to date, respectively. Editas, a super-wild stock, is trying to clear a 26.85 buy point.

Both companies are not yet profitable, yet institutions are showing strong interest in companies that are at the forefront of gene-editing-based cures.

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