IBM Gets a Quant Downgrade, But Here’s What the Charts Reveal

Shares of IBM (IBM) were downgraded Tuesday by TheStreet’s Quant Ratings service. Let’s check the charts to see if what the technicals say.

In the daily bar chart of IBM, below, we can see that the shares gapped lower in July and continue to struggle to regain or restart their longer-term uptrend. Prices have been trading around the 200-day moving average line. The 50-day moving average line intersects above the price action.

The On-Balance-Volume (OBV) has struggled since November. The Moving Average Convergence Divergence (MACD) oscillator has signaled a cover shorts buy signal.

In the weekly Japanese candlestick chart of IBM, below, we see a less-than-promising chart picture. Prices are trading around the 40-week moving average line.

The weekly OBV line shows weakness from January. The MACD oscillator has crossed to the downside and is only slightly above the zero line.

In this daily Point and Figure chart of IBM, below, we can see a potential downside price target in the $107 area.

In this weekly Point and Figure chart of IBM, below, we used close-only price data. Here we can see a target in the $173 area.

Bottom-line strategy: Stock prices are surging Wednesday morning but the market does not close until 4 p.m. and things can change quickly.