A lot of people forget about International Business Machines. However the 110-year old tech giant’s chart has some interesting patterns.
First and most important is the series of higher lows since early July. IBM has been trapped around the same $144 area where it bounced on June 21. That combination (higher lows + resistance) has produced a bullish ascending triangle with breakout potential.
Also notice how the 50-day simple moving average (SMA) and 100-day SMA closely match the top and bottoms of the ascending triangle.
The current squeeze is so tight that Bollinger Band Width has narrowed to its lowest reading since January 2020. This could add fuel to a breakout.
Finally, don’t forget about Oracle. The lumbering software giant broke out this year after its Cloud business improved. IBM gapped higher after showing similar progress its last two quarters. With a 12x forward P/E and price/revenue under 2x, it could also benefit from sentiment shifting toward value stocks.
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First and most important is the series of higher lows since early July. IBM has been trapped around the same $144 area where it bounced on June 21. That combination (higher lows + resistance) has produced a bullish ascending triangle with breakout potential.
Also notice how the 50-day simple moving average (SMA) and 100-day SMA closely match the top and bottoms of the ascending triangle.
The current squeeze is so tight that Bollinger Band Width has narrowed to its lowest reading since January 2020. This could add fuel to a breakout.
Finally, don’t forget about Oracle. The lumbering software giant broke out this year after its Cloud business improved. IBM gapped higher after showing similar progress its last two quarters. With a 12x forward P/E and price/revenue under 2x, it could also benefit from sentiment shifting toward value stocks.
TradeStation is a pioneer in the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
