Strong earnings buoy stocks…

Stocks held their own this week thanks to a good start to Q1 corporate earnings. The Dow Jones Industrial Average (chart) finished up 1.4%, the S&P 500 (chart) +0.60%, the Russell 2000 (chart) +0.96% and the Nasdaq (chart) actually lost a bit of ground falling a modest 0.36%. This however was the third straight weekly decline for the tech heavy Nasdaq.

Next week hundreds of companies will be reporting their first quarter results, but all eyes will most certainly be on everyone’s favorite stock, Apple Inc. (NasdaqGS: AAPL). Apple reports their earnings on Tuesday after the close and needless to say, this will be a market mover, at least for the Nasdaq. After surging an astonishing 77% since late November, the seemingly untouchable Apple has lost over 10% of it’s value over the past two weeks. So the question now is “is this a normal and heathy correction in Apple’s stock?” or a preview of more downside to come? If you are a technician and long the stock, you were very pleased that on Friday the stock held and closed above its 50-day moving average. However, with Tuesday’s earnings report on the horizon, I think for now you can throw all of the technical analysis out and wait to see how their quarterly results look.

If I were to take a side and as I continue to see all of the metrics point to a bullish quarter, this should be yet another earnings blowout for the company. But as I have learned over the years, it is always best to have a wait and see approach, listen to the conference call, see how the stock trades and then make a decision. Good luck to all.

Have a great weekend 🙂