In last week's What The Charts Say, we suggested that a decline below $180-$181 (U.S.) on International Business Machines Corp. would signal the start of a new down-trend. Indeed, the stock violated the $180-$181 level and reached a low of $172.57 (A). There is minor support at $160-$170 (shaded area), but a decline below this level could give way to a move toward $150 and $125.
A minor rally toward $180-$185 may occur, but all technical indicators, including the falling 40-week moving average (40wMA) and the moving average convergence-divergence (MACD - lower panel), confirm the negative status.
A move below about $165 could give way to a decline toward $150 and $125.
Monica Rizk is the senior technical analyst for Phases & Cycles Inc. (www.phases-cycles.com). Ron Meisels is a contributor to the www.NA-marketletter.com website and Tweets at @Ronsbriefs. They may hold shares in companies profiled. Please see the site for a glossary.