International Business Machines Corp. was in a long-term up-trend from 2009 to 2011 (A-B). It then settled in a range mostly between $181 (U.S.) and $215 (dotted lines) and recently declined to the bottom of this range (C). A rise above the 40-week moving average (40wMA) would suggest an up-move toward the top of the channel near about $215, however only a sustained rise above $215-$216 would signal the resumption of the long-term up-trend. Conversely a decline below $180-$181 would suggest the start of a new down-trend.
Look for a rise above $215-$216 or decline below $180-$181 to signal the direction of the next move.
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.