Early 2019 Performance of FAANG Stocks and What to Expect Next

The US tech sector attracts many day traders because it comprises the world’s largest and most popular companies. Meir Barak, founder of Tradenet – the largest day trading academy in the world, has always paid special attention to tech stocks, as they show decent intra-day volatility and are easier to track through fundamental analysis.

FAANG stocks include Facebook, Apple, Amazon, Netflix, and Google had a downward facing ending to 2018. Let us see how they have faired so far this year.  

January has been a great month for all the five stocks and the tech sector in general, with NASDAQ recording a monthly gain of over 9%.

Facebook

So far, Facebook (NASDAQ: FB) has had an impressive start of the year thanks to the general bullish sentiment in relation to the US tech sector and the positive financial report figures. During the last week of January, the social media giant presented better-than-expected earnings and revenues for the fourth quarter. The earnings per share (EPS) in the Q4 were $2.38 on revenue of $16.9 billion, while analysts on average expected EPS of $2.18 on revenue of $16.5 billion. After the news, the stock price formed a huge bull gap on the hourly chart.

Facebook’s monthly active users (MAUs) increased by 9% to 2.32 million, which reaffirms the company’s good health. Daily active users reached 1.52 billion, up 9% for the quarter. Both indicators are in line with the analysts’ expectations.

Founder and CEO Mark Zuckerberg commented:

“We’ve fundamentally changed how we run our company to focus on the biggest social issues, and we’re investing more to build new and inspiring ways for people to connect.”

We consider that FB is going to be a great stock for day traders for the whole year, with its current uptrend having great support for the coming weeks.

Amazon

Amazon (NASDAQ: AMZN) has probably been the worst performer among FAANG stocks so far this year, as it has moved in a sideways trend since January 8.

Some of the problems come from India. At the end of 2018, India updated the foreign direct investment (FDI) rules in e-commerce, causing additional obstacles for retail firms like Amazon. The new law doesn’t permit e-commerce website operators to “exercise ownership or control over the inventory” of sellers.

Because of the new regulations in India, the retail giant presented a Q1 revenue forecast that was below the analysts’ expectation.

Day traders should take note of any fundamental news that might have an impact on Amazon’s stock price.  

Apple

Apple (NASDAQ: AAPL) became the most valuable company again, closely followed by tech giants Microsoft and Amazon. The stock price is supported by the company’s reporting of sharp growth in its services business, which includes the App Store and Apple Music.

Besides, CEO Tim Cook revealed that the pressure from the US-China trade war is slowing down, which is good news for the iPhone maker’s performance in China. Apple is also lowering the price for its iPhone devices outside the US to offset the effect of a stronger US dollar.

Apple is expected to perform well this year, despite some minor legal issue that may come up with the French authorities or the Brexit effect.

In mid-January, Meir Barak commented on Apple’s performance:

“Apple released its guidance – and it’s not good. Although, it seems that there hasn’t been a better time to buy the stock – once you factor in that eventually the trade war will end.”

Netflix

Netflix (NASDAQ: NFLX) has had a great start this year, with the first week demonstrating a sharp growth. The bullish move was driven by the news that the company was ready to expand on the European continent. Netflix wants to increase the number of video shows in languages other than English. Recently, the company launched its movie and TV streaming service in Cuba.

This should be a bullish year for the media service provider, with Barron’s expecting some impressive revenue figures.  

Google (Alphabet)

While Google’s parent company has seen its price falling since in recent days, the stock has still gained almost 6% year-to-date. Alphabet (NASDAQ: GOOGL) recently reported Q4 earnings whose figures were better than analysts’ estimates. However, the operating income growth was below expectations, which put some pressure on the stock performance.

Google’s parent also reported much higher Q4 spending on employees, video content, and facilities, causing concerns among investors, who feel that the company’s growth isn’t “as capital-light as had been hoped.”

All in all, 2019 will be an interesting year for all of the FAANG stocks. If you want to get more insights and guidance on day trading tech stocks, feel free check Mr. Barak’s YouTube trading channel and site.