Applied Materials, Inc. (AMAT) manufactures computer chips, and the stoc♛k has gone from being in an "inflating parabolic bubble" a year ago to being "too cheap to ignore" now as the company reports quarterly results.

During the week of Nov. 17, 2017, the stock had a 澳洲幸运5官方开奖结果体彩网:stochastic reading of 92.57, above 90.00, which is my definition of an "inflating parabolic bubble." The stock set its all-time intraday high of $62.40 on March 12, 2018, and then plunged by 51% to its 2018 low of $30.53 on Oct. 29. The stock had a stochastic reading of 9.12 during the week of Nov. 2, below 10.00, which is my definition of a stock that is "too cheap to ignore." Applied Materials closed Wednesday, Nov. 14, at $33.58 down 34.3% year to date and in 澳洲幸运5官方开奖结果体彩网:bear market territory at 46.2% below its all-time high of $62.40 set on March 12. Since the low of $30.53 set on Oct. 29, t💝he stock is up 10%.

Analysts expect Applied Materials to post 澳洲幸运5官方开奖结果体彩网:earnings per share between 96 cents and 99 cents when the company report results after the closing bell on Thursday, Nov. 15. The stock had a positive reaction to earnings on Feb. 14, prompting the rally to the all-time high. A negative reaction following its earnings release on May 17 led to a "澳洲幸运5官方开奖结果体彩网:death cross" on June 5. ꩵThen, on Aug. 16, a negative reaction to earnings led to the 2018 low. The company is expanding beyond semiconductors, and new display technologies could drive a positive reaction to earning on Friday.

The daily chart for Applied Materials

Courtesy of MetaStock Xenith

The daily chart for Applied Materials shows that the stock has been below a "death cross" since June 5, when the 50-day 澳洲幸运5官方开奖结果体彩网:simple moving average fell below the 200-day simple moving average, indicating that lower prices would follow. The stock could have been sold at $53.04 on that date. A bearish warning occurred on the negative reaction to earnings on Aug. 16, when the stock gapped below my semiannual pivot of $44.97.

The weekly chart for Applied Materials

Courtesy of MetaStock Xenith

The weekly chart for Applied Materials is negative but oversold, with the stock below its five-week modified moving average of $35.79 and just below its 200-week simple moving average at $33.89, which is also the "澳洲幸运5官方开奖结果体彩网:reversion to the mean." The 12 x 3 x 3 weekly slow stochastic reading is projected to end this week at 1༺6.69, up from 12.46 on Nov. 9. A weekly close ♈above $35.79 would be positive following earnings.

Given these charts and analysis, my strategy is to buy Applied Materials s▨hares on weakness to my monthly value level at $30.92 and reduce holdings on strength to my annual and semiannual risky lev🦩els of $37.61 and $44.97, respectively.

Disclosure: The author has no positions in any stocks mentioned and no plans to initiate any positions within the next 72 hours.