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A close look shows why the tech rally could be back on – CNBC

June 20
15:14 2017

Some strategists are forecasting further upside for technology stocks based upon technical indicators and options market activity after the group posted its best day of the year.

Technology stocks appeared to recover on Monday after several sluggish days earlier this month, when a market rotation caused the sector — particularly some major players like Apple and Microsoft — to slide. The information technology sector is still leading the market as the best performer.

“The trend is still higher. That’s the important point,” Oppenheimer technical strategist Ari Wald said Monday on CNBC’s “Power Lunch.”

The technology sector has indeed underperformed relative to the broader market over the last two weeks, Wald pointed out, and had retraced 38 percent of its gains since December. Such a level of retracement is considered a classic technical indicator, Wald noted, and at this point he believes the sector will begin to stabilize.

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