Is the Nasdaq Ready to Bounce Back?

It looks like the Black Friday sales have come early to some of the biggest technology stocks in the Nasdaq.

Stocks like Cisco Systems (CSCO), SanDisk Corporation (SNDK) and Kla-Tencor (KLAC) have all been swept into oversold territory by the Thanksgiving week selling that has taken the Nasdaq 100, for example, lower for five out of the past six trading days.

But what makes these three stocks potentially worth noting is that the pullbacks they are experiencing are taking place at or near bull market territory. This means that historically speaking, all three stocks are at levels where traders have found prices attractive and entered the market to bid shares higher in the short term.

Cisco Systems is one of a number of stocks that has been selling off in the wake of rallying to new, multi-month highs. The stock has closed lower for six days in a row, the most recent three sessions ending in oversold territory. As such, CSCO has earned a “consider buying” rating of 8 out of 10 ahead of trading on Friday.

Also earning ratings of 8 out of 10 as of Wednesday’s close are shares of Sandisk Corporation. Finishing in oversold territory above the 200-day moving average for three out of the past four trading days, SNDK has pulled back to its lowest levels in a month.

Like SNDK, shares of Kla-Tencor Corp (KLAC) are only recently trading in bull market territory, climbing back above the 200-day moving average in mid-October. KLAC has finished lower for six days in a row and also has earned a “consider buying” rating of 8 out of 10 heading into trading on Friday.

As compelling at the current ratings are in all three stocks, additional weakness in the short term – even on an intraday basis, could provide opportunities for traders to take advantage of further ratings upgrades and even larger historical edges.

All of the stocks in today’s report were available from research and data available through PowerRatings. To learn more, click here.

David Penn is Editor in Chief of TradingMarkets.com