Chart(s) of the Day – The 2013 Net Leaders, $GOOG, $AMZN, $PCLN, $NFLX

by Enis December 31, 2013 10:42 am • Commentary

On the final day of 2013, I wanted to take a look at some of the biggest market cap internet stocks that have been big winners this year.  My hunch is that their start to 2014 will give an early hint on what type of new year might be in store.  So here’s a look at the important technical levels before Sydney, Australia starts off the firework shows around the globe, and champagne corks are popped far and wide.

First, Google, the largest internet company in the world, at a $370 billion market cap is up 57% in 2013.  The stock made a new all-time high yesterday, so no resistance for the stock, with short-term support in the $1040-$1050 area (green line):

GOOG daily, 50 day ma in pink, 200 day ma in black, Courtesy of Bloomberg
GOOG daily, 50 day ma in pink, 200 day ma in black, Courtesy of Bloomberg

The rising 200 day ma comes into play in the low 900’s, which are likely not in play barring a major miss on earnings in late January.

AMZN is also up 57% in 2013, and now a $180 billion market cap company.  Its chart is a bit less constructive, though still not much reason for concern for bulls given the continued trend of higher highs and higher lows:

AMZN daily, 50 day ma in pink, 200 day ma in black, Courtesy of Bloomberg
AMZN daily, 50 day ma in pink, 200 day ma in black, Courtesy of Bloomberg

The stock has fallen back below the December 2nd high near $400 this week, but it will hold the short-term trend of higher lows if it remains above $379.50.  The rising 50 day ma is now around $372.  More important support is at the November low around $342.  Rising 200 day ma is around $305.  Our Name That Trade idea on AMZN from December 2nd still looks intriguing today.

PCLN is up 86% for the year, taking its market cap to $59 billion.  Its chart is more concerning than GOOG or AMZN from a short-term perspective.  The stock is near a 1 month low after two straight declines of 1.5%.  The stock is approaching its rising 50 day ma, which is at $1133.  PCLN has not traded below its 50 day ma since early May:

PCLN daily, 50 day ma in pink, 200 day ma in black, Courtesy of Bloomberg
PCLN daily, 50 day ma in pink, 200 day ma in black, Courtesy of Bloomberg

In the meantime, the $1200 level has acted as resistance for the past month, so I’ll be watching that level closely in January.  If the 50 day ma does break, $1100 is minor support, while $1000 is crucial long-term support (was also the prior all-time high from 1999).

Finally, I’m closing with NFLX, even though it is a much smaller market cap company ($22 billion) with fewer market-wide implications.  But it’s a fascinating chart nonetheless.

NFLX is up almost 300% in 2013.  However, the stock has not been able to climb above its October earnings peak registered at $389.16 (red line):

NFLX daily, 50 day ma in pink, 200 day ma in black, Courtesy of Bloomberg
NFLX daily, 50 day ma in pink, 200 day ma in black, Courtesy of Bloomberg

The rising 50 day ma is now around $350.  NFLX has generally found support near the 50 day ma for the past 6 months.  If that level does not hold, then the $300 level is much more important long-term support (also near the 2011 high).

I am watching these 4 stocks with special interest over the next few weeks.  While Twitter has stole the momentum eyeballs over the past month, the big boy internet stocks are likely a better tell of stock market demand to start the new year.