IBM: Another Value Turnaround?
International Business Machines has been in a downtrend for almost a decade, but now it could be showing signs of a turn.
The main pattern on today’s chart is the bullish gap following the last quarterly report on April 19. IBM has retraced almost all the jump but remains higher despite a big drop in the broader market at the same time.
The rally established prices above the 50-day simple moving average (SMA). That’s something of a feat that only nine members of the
XLK
managed to achieve yesterday, according to TradeStation data. (XLK’s portfolio includes 70+ companies.)
Speaking of the 50-day SMA, it’s rising toward the 200-day SMA. Is a “golden cross” coming soon?
Third, the stock’s long decline has produced a falling trendline that IBM has battled since June. Will the current strength result in a breakout through the downtrend?
Finally, consider that IBM jumped last month because management is finally shifting more of its revenue to cloud services. In that way, it may have potential as a “value turnaround,” similar to Oracle a year ago.
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This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: www.tradestation.com/important-information.
The main pattern on today’s chart is the bullish gap following the last quarterly report on April 19. IBM has retraced almost all the jump but remains higher despite a big drop in the broader market at the same time.
The rally established prices above the 50-day simple moving average (SMA). That’s something of a feat that only nine members of the
XLK
managed to achieve yesterday, according to TradeStation data. (XLK’s portfolio includes 70+ companies.) Speaking of the 50-day SMA, it’s rising toward the 200-day SMA. Is a “golden cross” coming soon?
Third, the stock’s long decline has produced a falling trendline that IBM has battled since June. Will the current strength result in a breakout through the downtrend?
Finally, consider that IBM jumped last month because management is finally shifting more of its revenue to cloud services. In that way, it may have potential as a “value turnaround,” similar to Oracle a year ago.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. You Can Trade, Inc. is also a wholly owned subsidiary of TradeStation Group, Inc., operating under its own brand and trademarks. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: www.tradestation.com/important-information.
