Much ado has been made about the increased demand for wireless technology, so lets see how wireless stocks have performed this week.
Wireless Index Daily Chart
The Wireless Index (YLS) started the week at 81.78, and is currently at 77.14. That's a 5.7% drop. Better than most sectors, but by no means bullish. With support at 79.50 gone, the prospects for the sector aren't great.
Since Nokia (NOK) controls the bulk of the handset market, it received most of the attention. Everyone hasn't run out and bought a new Nokia 8260 cell phone, but the stock has gained $1.74 this week, or 12.6%. That's well below earlier gains this week, mostly because NOK ran into resistance at $16.90. Today's drop almost filled the gap that formed Monday, but Nokia has moved off its lows. If that gap continues hold, Nokia's downside is $1.60. The upside looks like $1.40 if resistance at $16.90 persists. Basically Nokia looks like a 50/50 proposition at this level.
AT&T Wireless and Sprint PCS Daily Chart
Cell phones don't work without service, so service providers must have done well this week. AT&T Wireless (AWE) has gained 9.7% this week, but has given up 50 cents of those gains today. A close above $15.18 would be encouraging, but resistance makes that $16 to $17 look troublesome for anyone thinking about getting on board here.
Sprint (PCS) has experienced a seesaw week, and is only 46 cents higher than where it started the week. That's because the 50-day and 200-day moving averages have held this stock back from testing resistance at $26. While the upside may be limited, the good news is that the 6-month up trend remains in place. Not many stocks can make that claim these days.
So if Nokia, AT&T, and Sprint are all higher for the week, why is the sector down? Losses from Ericsson, Nextel, Palm, and Qualcomm have offset any gains.