November 7 Chart of the Day - Bristol-Myers Squibb
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Big Pharma maker Bristol-Myers Squibb (BMY) has been making headlines lately stating that its stock price, down nearly 40% in the last year, may be a "bargain."
You know what they say about beauty being in the eye of the beholder...
We think that could also be the case for those making those claims. Even though the company exceeded earnings estimates when they reported the last week of October their stock price spectacularly really went nowhere.
Trading around $53 earlier today we found that price has fallen down back towards a "change control zone" on the monthly chart.
Change control zones are one of the five price action tools we teach when charting anything. By definition, they are an area that represents where neither the bulls nor bears are in charge. Price can slash though the zone with seemingly reckless abandon, price can respect the top or bottom from outside it or within it. Or, price can trade aimlessly sideways within it. When price breaks away from the zone it can often get drawn back to it like a magnet. And in this case we see all of the above are true.
The bulls stepped in right where they needed right around $50 to in order to protect further downside pressure. The question now becomes can they continue to hold that level or will price continue to dance in and around the change control zone.
Down on the weekly chart we've used Fibonacci levels to help identify price levels of interest in both directions. From here, traders and investors can further develop their plans.
So what's next?
We don't make predictions...
Nobody knows for sure but using these 5 price action tools traders and investors can develop levels of interest in both directions.
- Support/Resistance
- Trend
- Fibonacci
- Supply/Demand Zones,
- Change Control Zones
Take a look at the charts and let us know what you think.
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