TESLA DROPS AFTER RECORD EARNINGS -- BIG TECHS REPORT THIS WEEK

TESLA DROPS AFTER REPORTING RECORD EARNINGS... How stocks react to earnings reports often tells us something about their technical condition.  Tesla (TSLA)  is a good example.  Two weeks ago I showed Tesla rising decisively above its 50-day moving average which suggested that the stock might be bottoming.   That interpretation is now very much in doubt.   Chart 1 shows the stock trading sideways over the past two weeks and trading lower today.   What makes today's selling so disappointing is that Tesla reported a record quarterly profit after the close yesterday as well as a 74% jump in revenue from the previous year.   The stock actually lost ground in after hours trading and is down again today.   It's normally not a good sign when a stock drops on strong fundamental news.   Tesla now appears headed toward the bottom of its recent trading range and a possible retest of its 50-day average.

BIG TECHS ARE NEXT... Five of the market's biggest technology stocks will be reporting earnings  between this evening and Thursday.   All five have gained ground of late and expectations for earnings appear optimistic.  Which could provide an important test.   How those big tech stocks react to those earnings should be very enlightening both for them and rest of the market.  That will be especially true if they react badly to good fundamental news.    Like Tesla.