When we were kids we played on the teeter-totter. We learned that while our friend was up we were down, that for every action there is an equal and opposite reaction. Today we can see the same laws apply when companies compete. Apple and Microsoft are constantly pushing to sit on the top. It can be challenging for the investor to spot the changes in these companies when $MSFT and $AAPL compete in so many areas e.g. smart phones, personal computers, software and entertainment. However, when news of a special event, such as Apple’s iPhone release, can spark a stock’s price action and generate opportunities to buy/sell.
In today’s NinjaTrader chart of the day we compare MSFT to AAPL in a single chart panel window through NinjaTrader Multi-Instrument analysis feature. Then we zoomed into an announcement day in Apple’s recent history plotting a line on close for each minute of the trading session. While looking at these charts we can see that early in the day the excitement over AAPL is high and the bulls take control leading to higher prices. Subsequently, MSFT shares fall at almost the same rate creating an interesting comparison in the two markets. I marked the contrast with NinjaTraders preloaded vertical drawing tool.
Savvy investors can look to these relationships to not only find one high probability trade, but two! NinjaTrader makes it easy with a free charting service to help calculate entries and fine tune your strategies with market replay capabilities. This is just one example of comparing two companies side by side. Can the same trends be seen for any other competing companies? Get NinjaTrader for free and try today!