Earnings Play: NetApp

Upside breakout from a long-term bearish channel.

Uptrend 4

On Tuesday, after market, NetApp (NTAP) is expected to report second quarter EPS of $0.73 compared to $1.09 last year on revenue of approximately $1.3 billion vs. $1.4 billion a year earlier. The Co is a leading provider of data management and storage solutions, and its current analyst consensus rating is 7 buys, 18 holds and 3 sells, according to Bloomberg.

Looking at a weekly chart, NetApp's stock price recently broke out to the upside of a long-term downward channel that began to form in September of 2018. The RSI is holding over 60 and shows bullish momentum. Price appears to have used to the 200-week simple moving average (SMA) as resistance.        

Source: GAIN Capital, TradingView

Looking at a daily chart,
NetApp's stock price has been rallying since late-October, early-November and on November 16th, price broke out to the upside of the long-term bearish channel that price was declining within since September of 2018. The RSI has just retreated from overbought territory and its holding above 60. The SMAs are bullish, as the 20-day SMA is above the 50-day SMA and the 50-day SMA is above the 200-day SMA. Price could possibly pull back to the upper trendline of the long-term bearish channel where it would likely find support before continuing to advance. If price can get above 55.75, then its next target would be 61.00. If price can get above 61.00, then it could continue to rise. On the other hand, if price falls below 49.75, it would be a bearish signal that could send price back to 46.75. If price is not able to find support at 46.75, then price could fall further.     

Source: GAIN Capital, TradingView

Build your confidence risk free

More from Earnings

Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.