Mishedlo,
I wouldn't short IBM. The 12 month chart is a rather chaotic trading range, with gaps and islands. There was a professional gap up in January after an island reversal, and now IBM is in a confirmed uptrend, with higher highs and higher lows above upsloping long term moving averages.
askresearch.com
There are technical sell signals now, but I can't see that IBM has very much downside potential.
ANF is similar. Very overbought, with technical sell signals, but ANF is an even less attractive short to me, since it has just reached a 52 week high, taking out the previous peak, and confirming the new uptrend.
askresearch.com
Both IBM and ANF have adhered closely to their 10 day moving averages, and both are sitting there now, so it's hard to even make a case for significant consolidation here.
CIEN is the only one of the three I would consider taking a short position on. CIEN formed a topping formation in October, followed immediately by a professional gap down, and it then began to form a series of lower highs and lower lows below the long term moving averages, which then began to trend downwards or horizontal:
askresearch.com
CIEN has now formed two small island patterns, the last lower than the previous, and each representing a failure at the test of overhead resistance from the long-term moving averages:
askresearch.com
The last two candles, which occur after a bullish pennant formation, suggest short term reversal to the upside is likely, and consistent with this, there are early technical buy signals showing.
Medium to long term, CIEN looks to be a good short. Short term, it is more likely to rally. I would watch CIEN only at this point, hoping for a rally; then, I'd look to short at the appearance of technical and candle weakness. Ideally, this would be at a point slightly lower than the previous two failures. So I would hope for a failure and a short entry around 90-95.
CIEN has considerable downside potential, and little evidence of upside potential at this point. But along these lines, it would be wise to check the put/call ratio compared to its historic norm, and also the short interest.
JMVHO......
WS |
