We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
GBP/USD
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
Oil - US Crude
Mixed
Bitcoin
Bullish
More View more
Real Time News
  • - Fed's Clarida: US economy is in a good place but there are "evident risks" - ECB policymakers do not expect additional easing in coming months - Aramco says the timing of its IPO is predicated on market conditions - Johnson tells Tusk he will ask for #brexit extension ⬇️ (BBG)
  • (Asia Pacific AM Briefing) British Pound Prices May Gap Lower After Brexit Deal Vote Delayed $GBPUSD #Brexit - https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/asia_am_briefing/2019/10/20/British-Pound-Prices-May-Gap-Lower-After-Brexit-Deal-Vote-Delayed.html?CHID=9&QPID=917702
  • Crude oil prices may encounter significant selling pressure if China retaliates against the US and pushes back trade war talks. Get your crude #oil market update from @ZabelinDimitri here: https://t.co/vMwa6rmFpH #OOTT https://t.co/vPkJ3oQgwV
  • The Singapore Dollar is driven by the Monetary Authority of Singapore, which manages exchange rate instead of short-term interest rates. Learn more on the $SGD and how to trade it. Get your update from @ddubrovskyFX here: https://t.co/eWLM9XZs5Y https://t.co/OWuwGML4Ch
  • RT @FT: Huawei admits that US sanctions are hurting https://t.co/GIT4XSfszx
  • RT @WSJecon: Mexico’s inflation eased in September, coming in line with the Bank of Mexico’s 3% target for the first time in three years ht…
  • My phone's decided to give up the ghost and I've been phoneless for 24 hours. Not coincidentally, I've been a machine tackling errands around the house. What a time to be alive.
  • #Gold remains stuck in a range as a range of conflicting forces battle and fail to take control of price action. Get your $gld market update from @nickcawley1 here: https://t.co/pw7UjkUyqH $XAUUSD https://t.co/YD8L6knjhe
  • Geopolitical developments send oil prices soaring or falling. Get your market update here: https://t.co/0znHZPvPON https://t.co/s358dvMBeR
  • Currency markets may be battered by breakneck volatility if a slowdown in global economic growth triggers a collapse in the fragile market for collateralized loan obligations (CLOs). Get your market update from @ZabelinDimitri here:https://t.co/KfjjtaXs7b https://t.co/sWeSlv33pb
Micron (MU) Earnings Outlook: US-China Trade War to Weigh

Micron (MU) Earnings Outlook: US-China Trade War to Weigh

2019-06-24 22:05:00
Peter Hanks, Junior Analyst
Share:

Micron (MU) Earnings Outlook:

  • Micron has been caught in the crossfire of the US-China trade war
  • Since the conflict began in June 2018, MU’s share price has been nearly cut in half
  • MU is one of the first in the industry to report each quarter, offering early insight into the sector

Micron (MU) Earnings Outlook: US-China Trade War to Weigh

Semiconductor-manufacturer Micron (MU) will report their third quarter earnings on Tuesday and is one of the first in the sector to do so. The results will offer insight on the company’s own outlook, but also provide a glimpse at the themes impacting the industry. On a single-stock basis, expectations for Micron are low.

Micron MU revenue chart

Source: Bloomberg

Trading just shy of $33.50 on Monday, MU shares have gained a meager 2.2% in the year-to-date. By comparison, the S&P 500, Nasdaq 100 and SOX Semiconductor ETF have climbed 11.6%, 21.7% and 21.5% respectively. The relative underperformance of Micron is due to a series of factors, of which the US-China trade war is arguably the most dominant - at present. Micron derives notable portions of its revenue stream from the world’s second-largest economy and tech is an area of heightened scrutiny in the ongoing trade war. Coupled with other industry-specific headwinds, Micron has delivered a series of cuts to its revenue and earnings estimates in recent quarters.

Micron MU price chart and eps

Data: Bloomberg

That said, the sentiment surrounding MU shares is bleak and expectations heading into earnings are on the floor. Still, implied volatility is heightened with a 1-day implied move of 8.4%. Across a broader timeframe, the 20-day implied volatility is particularly steep at 44% - likely due in part to the Trump-Xi meeting in Osaka, Japan.

MU micron earnings implied volatility

From a technical perspective, MU trades near the bottom of its two-year range and just $5 above the lows tagged in late December. Within the implied price range, $32 may provide a modicum of support as it has throughout May and June. If the wheels really come off the bus, the December 26 low at $28.48 is the final point of buoyancy – but lies outside the 1-day implied price range.

Micron (MU) Price Chart: Daily Time Frame (June 2018 – June 2019)

MU Micron price chart

To the topside, the 61.8% Fib at $34.75 will offer resistance. Further, June’s swing high at $36 could come into play as a secondary barrier to a substantial bullish reaction. With substantial downward pressure and minimal expectations, Micron looks poised for yet another disappointing quarter.

With that in mind, the risk-reward perspective of a MU trade is somewhat unattractive. Should the company deliver even a sliver of hope for the coming quarter, it could result in a bullish reaction and punish shorts looking to capitalize off of the wounded stock. For updates and analysis on Micron and other tech stocks, follow @PeterHanksFX on Twitter

--Written by Peter Hanks, Junior Analyst for DailyFX.com

Contact and follow Peter on Twitter @PeterHanksFX

Read more:AUDUSD & Nasdaq 100 Price Outlook: Huawei Offers Opportunity

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.