5 Tech giants reporting this week

Five of the largest tech stocks report this week in what will likely set up the sector for the rest of the year. Is it time for a turnaround?
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The sector woes

Tech stocks have been the most under pressure this year as the higher cost of leveraging has made traders avoid stocks with high valuations. In the meantime, those companies have seen increased sales and profits, thanks to cloud transitioning and solid ad revenue. Now traders are likely to care most about guidance into the following year and whether the threat of a recession can undermine the gains that would support a rebound when borrowing costs come down.

Alphabet is expected to report earnings of $1.27 on $71.0B in revenue. Despite others in the sector suffering, such as SNAP, Google might be insulated from a slump in ad revenues thanks to its proprietary technology. But if the company were to miss on earnings, it could weigh on other tech giants.

Microsoft is expected to report earnings of $2.31 on $49.7B in sales. Azure and Intelligent Cloud are expected to continue to buy the company above slower software sales, as inflation has pushed companies to cut costs. However, the high dollar could pose a challenge to revenues Meta is forecast to report earnings of $1.90 on $27.5B in revenue. The business model that helped the company cash in due to the pandemic might be getting in the way of revenue growth, as smaller companies have less room to keep advertising in challenging conditions. Focus still on the troubled launch of the metaverse.

Apple is expected to report earnings of $1.27 on $88.9B in sales. Last week reports circulated that Apple was cutting production of its new iPhone right after launch, dragging on the market. Although after the close of the quarter, the CEO is likely to be pressed to comment on the issue.

Amazon is expected to report earnings of $0.22 on $127.5B in revenue. The world's largest retailer has been facing a slump in profitability, primarily due to increases in salaries and investment in logistics. But after logistics companies in the US and Europe cut their forecasts on shipments, traders will be keen to know if Amazon agrees.

One Apple a day keeps the bears away

Contrary to the rest of the tech stocks reporting, Apple's share price has broken above its October 6 th resistance. Following two higher-highs at 145 and 147 and two higher-lows at 138 and 140 – respectively, the upward-sloping trend lines connecting them resemble a rising
wedge.

If Apple's share price breaks above the upper trendline the likelihood of reaching R1 at 161 would increase. This is equal to the height of the first upward leg from 138 to 145, assuming a breakout at 154. Above there, R2 and R3 at 165 and 176 will come into closer proximity.

However, if bears regain control, the pattern would get invalidated, and prices might reverse. S1 at 142 is the near-term support above the low at 134, where S2 can be observed. S3 lies below there at June's low of 129.

Key takeaways

Tech stocks have been struggling this year as traders have avoided high-valuation stocks. However, many tech companies are still doing well thanks to solid sales and profits. Going forward, traders will be focused on whether or not a recession could damage the sector's rebound potential as the five largest tech stock reports this week.