Technical Analysis – IBM stock recovers marginally some losses; long term sell-off in play
October 15, 2018 1:26 pm
IBM stock price lost significant ground in the preceding week, plunging to a new more than three-month low of 138.64. However, the technical view suggests a possible retracement in the daily timeframe. The RSI indicator is sloping up in the oversold zone, while the %K line of the stochastic oscillator posted a bullish crossover with the %D line, indicating that the downside risk is fading.
Further losses should see the June 27 low acting as a major support near 137.40. A drop below this key level would reinforce the long-term bearish structure and open the way towards the next barrier of 134.30, where it topped on February 2016.
In the event of an upside reversal, investors would have a look at the next immediate psychological resistance level of 142.00. A break above this level would re-challenge the 144.60 barrier, while even higher, the market could touch the 20- and then the 40-simple moving averages (SMAs) at 147.70 and 148.94 respectively. It is worth mentioning that the SMAs are moving south, acting as major resistances for the bulls.
However, for a resumption of the longer-term downtrend, which was halted in February 2017, IBM stock price would need to beat the three-month low of 137.40.
IBM stock price lost significant ground in the preceding week, plunging to a new more than three-month low of 138.64. However, the technical view suggests a possible retracement in the daily timeframe. The RSI indicator is sloping up in the oversold zone, while the %K line of the stochastic oscillator posted a bullish crossover with the %D line, indicating that the downside risk is fading.
Further losses should see the June 27 low acting as a major support near 137.40. A drop below this key level would reinforce the long-term bearish structure and open the way towards the next barrier of 134.30, where it topped on February 2016.
In the event of an upside reversal, investors would have a look at the next immediate psychological resistance level of 142.00. A break above this level would re-challenge the 144.60 barrier, while even higher, the market could touch the 20- and then the 40-simple moving averages (SMAs) at 147.70 and 148.94 respectively. It is worth mentioning that the SMAs are moving south, acting as major resistances for the bulls.
However, for a resumption of the longer-term downtrend, which was halted in February 2017, IBM stock price would need to beat the three-month low of 137.40.
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