Don't fear the tech wreck — buy all dips, technician says

Technology stocks have sunk around 10 percent in just one month. For investors burned by the trade, one top technician says the group is still safe to own.

Mark Newton, president of Newton Advisors, said he's not backing away from tech stocks, or some of the most popular names in the group.

"Technically, we've been able to recoup a lot of that damage that's been done over the last couple weeks. And so [tech sector ETF] XLK for me is still an area you want to be in near term. I'd look to buy any dips like we're seeing, thinking that into the midterms and throughout November and December we could see some further upward progress," he said Friday on CNBC's "Trading Nation."

Apple dragged down the tech space on Friday, posting its worst day in four years, a day after saying it would no longer give unit sales figures in future reports.

Apple is far from a sell at this juncture, said Michael Bapis, managing director with Vios Advisors at Rockefeller Capital Management. He said investors likely "panicked" around Apple's earnings report, and he would stick with the name in the long term.

"I would own Apple all day at 15 times next year's earnings, getting a dividend of 1.5 percent. I don't think you can find better than that. As far as where to hide, we're seeing a rotation out of a lot of the high-volatility, low-earnings, FANG-type of stocks. We're seeing the rotation move more into earnings-driven companies in the technology sector," he said.

Bapis added that he also sees opportunity in shares of Microsoft because of the company's cloud business.

Overall, the tech shakeout "is just a small little blip on the radar, and you're going to see tech outperform for the near future."

Apple shares closed nearly 7 percent lower on Friday, barely off session lows, at $207.48 per share. The XLK closed lower by 2 percent. They were down slightly in Monday's premarket.

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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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