Charts to Watch: SPX, SPCX, SATS

Nicole (0:00)

Welcome back to The Watch List. Time now for Charts to Watch. And Patrick Ciummo is with us, Senior Manager, Trading Services, Charles Schwab. Taking a look here, let's just start with the S&P 500, which hit a record this week, closed above 7,800 for the very first time. It's up about 14% for this year. Your thoughts on this chart?

Patrick Ciummo (0:19)

Yeah, thanks for having me, Nicole. Nice to see you in the afternoon. Hopefully no mangoes in your head here. Looking at the SPX, one thing that stood out to me right from the bat was the alignment. And if you look at moving averages, which again are technical indicators that usually lag price, you can see alignment from April 23rd, when the moving averages, 20 got above the 50 and the 50 got above the 200 Short story long for investors or traders, that is a bullish indication on when to get long. And at the time, this was at a high RSI indicated and that was oversold. Well, if you were to buy on that day and not sell it until there was a moving average crossover, you would still be long 117 trade-in days later and up about approximately 10 percent in the index when the breath is not there to support it.

Nicole (1:10)

And so at this point now, right now, we're seeing the S&P at 7817 So we may close that above that 7,800 again. Let's talk about SpaceX. There's so much news and the shares have been up this month. We've had a lot of positive comments this week. We just spoke to Dan Ives, we spoke to Landon Swann from Look Like Folio. They seem to really like what they're seeing with SpaceX. But what do you say when you look at the shares and the charts and the technicals?

Patrick Ciummo (1:35)

Yeah, the SpaceX has a big level that's been building since its IPO in June, roughly around that $155 to $150 level. And it recently broke out on some nice momentum. You can see two bullish candles there to the upside, only to pull back to that previous kind of resistance that it broke. This is often a pattern that will show up in technical analysis. And sticking with the trend moving averages, you have the 20 and the 50-day moving average aligned, crossing up below it as support, as well as the all-time high VWAP, which again, I don't want to throw mangoes in your head, but that is a bullish indicator as well. So if you have a pullback to prior resistance, you may have people trying to get on board, or if you want to wait and see if it bounces, you could potentially get on middle of this channel and see if it resumes its uptrend.

Nicole (2:27)

All right, last but not least, EchoStar. The shares have been down off the all-time highs that it hit in mid-May, down about 35% since then. Echo is right now at $94.

What stands out to you in the chart?

Patrick Ciummo (2:41)

Yeah, one of the things about EchoStar was kind of an unknown name to me when it hit my scans, and I dug into it a little bit, and right off the bat, looking at the middle of this chart, it looked a lot like the SpaceX chart to me, and as a technical guy, I started looking at the fundamentals, and a lot of this EchoStar is SpaceX type shares. They were given about $8 billion in SpaceX shares, and $8 billion in cash from some mergers, not mergers, some business dealings that they had, and a lot of people aren't aware that EchoStar is in the telecommunications industry. SpaceX is also getting into that industry. They've had a lot of business dealings already. And as this tries to hold up like SpaceX is, one thing to note that this has an extremely high short interest, around 20%, and a short interest ratio of 6.7%. So that means if people who are short had to buy in, they have about six to seven days of approximate buying pressure that would be added on to this. So looking at this from a technical standpoint, it's holding that kind of trend line, holding the 20 and the 50-day moving average. The 200-day moving average is above that resistance level, around $108, but if it can get up and through, and SpaceX is to go up as well, this could be a decent sympathy trade to attach on to the rocket.

Nicole (4:05)

All right, Patrick, thank you so much. It's great to see you. Patrick Ciummo, really nice to see you. Senior Manager, Trading Services, Charles Schwab.