Intel Corp (Intc) technical analysis February 2020

Trend

The monthly chart show that Intel Corp (Intc) stock price is in an uptrend. This can be seen in the formation of higher-highs and higher-lows. It is also shown by the movement of the 50 period moving average (MA50) above the 200 period moving average (MA200), and the upward sloping of both MAs.

The daily chart also shows a similar picture. The directional movement index (DMI) is also showing a potential bullish signal, but more on this below.

Chart pattern

Monthly chart pattern

A double bottom was formed on the monthly chart. This pattern was formed in the background of an uptrend, thus can be considered a bullish continuation pattern.

The resistance-turned-support was successfully retested in the previous candle and the price has since moved higher.

Weekly chart pattern

The weekly chart shows a flag breakout pattern. The pole of the flag begins around $33, and peaks around $58 for a length of $25 before the flag-pattern consolidation began. A target price (TP) can be set by extrapolating the pole length on the point of breakout. As the breakout was around $58, a TP of $83 can be set.

A more conservative approach would be to extrapolate the height of the flag onto the breakout level. This is illustrated by the green arrows in the chart above, for a TP of around $71.

Directional movement index (DMI)

The DMI on the daily chart shows that the stock price has been in a bullish trend since around October 2019. This is seen in the corresponding upwards move in prices coinciding with divergence of the +DI and -DI with the +DI trending above, and and ADX (black line) sloping upwards.

A convergence of the +DI and -DI along with a downsloping of the ADX which was seen in November/December 2019 signals a possible consolidation (or start of a reversal). This was corresponded to in the price movement which trended sideways during this period (consolidated) before moving up again. This scenario in the DMI can be taken as an indication that the primary trend is an uptrend. Of course this fact is more easily seen in price action and moving averages, but this movement pattern in the DMI can be used as a confirmation (though my usage of this indicator is not to ascertain trend).

After another consolidation in January 2020, where the +DI and -DI converged again, prices shot up in a renewed upwards thrust.

This strong move up is accompanied by a renewed divergence of the +DI and -DI and up sloping of the ADX (latest portion of the chart). A movement like this in the ADX indicates a possible:

  1. strong uptrend
  2. ‘young’ uptrend

Conclusion

With the trend, price patterns and indicators being as above, technically speaking Intel Corp (Intc) may be a potential candidate for a bullish position.

It should be noted that technical analysis only provides probabilities of prices moving in a certain direction and towards certain points.

Your point of entry and exit, your time frame, trading method and risk management are also determinants of probability for success.

So – Trade at your own risk.

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