The companies that offer innovative technological solutions, are a few of the better positioned in the changing global marketplace. The graphs discussed below will highlight the way in which the recent price action has sent the price above key levels of resistance and the way in which these stocks could be poised to make a significant move higher from the current levels.
SPDR FactSet Innovative Technology ETF (XTIK)
Traders who are looking to add innovative tech stocks to their portfolios often turn to exchange traded products like the SPDR FactSet Innovative Technology ETF (XITK). As the name of the fund indicates, the fund’s managers seek to construct a portfolio of companies within sub-sectors with a strong growth of products that can provide the cutting edge products and services. In general, the activities of enterprises in the technology sector and the electronic media sub-sector, and not only within a trend.
As you can see on the chart below, the fund price has recently risen above a key level of resistance marked by the horizontal trend line. The escape, as illustrated by the blue circle, has triggered a bullish crossover between the long-term moving averages, which seems to be a catalyst for the purchase of the interest and the increase in trading activities as measured by the volume of transactions. Based on this model, traders are waiting for the bulls to keep control of the dynamics, and many will probably protect against a change of feeling, placing stop-loss orders below $113.
Zoom Video Communications, Inc. (ZM)
An innovative technology company that has taken the world market of attention during the last few weeks is the Zoom Video Communications, Inc. (ZM). As you can see on the chart below, the stock is trading within a very strong bullish trend, which has been supported by a rising trend line and its 50-day moving average.
Traders will probably continue to use these levels in the determination of the location of the stop orders in the coming weeks to protect against surprise to the sell-off. Uptrend, traders will also want to take note the breakout above $180, which is highlighted by the blue circle, which is a technical buy signal and may be the start of a prolonged move higher.
Zscaler, Inc. (ZS)
Another top holding of the XITK ETF that offers innovative solutions Zscaler, Inc. (ZS). Unknown to many people outside of the technology sector, the company is a global leader in the cloud security services.
Taking a look at the chart below, the price is recent price action has exceeded a key trend above the average and spiking volume, which suggests that the bulls are in control of the amount of movement. As a confirmation, the followers of the technical analysis will also want to note the recent bullish crossover between the long-term moving averages, as this could mark the beginning of a long-term bullish.
The Bottom Line
Innovative technology companies have resisted in recent weeks as people around the world to seek out new ways to work and stay in contact with the other. Based on the maps discussed above, it seems that we could still be in the early stages of a long upward movement.
At the time of writing, Casey Murphy did not own a position in any of the assets mentioned.