By: Zev Spiro
A macro bullish trend has been in place for Ameriprise Financial Inc. (AMP) since early 2009. Currently prices are at major resistance from 2007 and may be close to a trend change. There is a negative divergence seen in the RSI indicator on the long-term weekly chart. As the price makes higher highs, the RSI puts in lower highs. A confirmed break below the primary bullish support line will be the signal to liquidate longs. In addition, a potential bearish head and shoulders pattern may be forming on the daily chart that will trigger with a confirmed move below the neckline, at 58 dollars.
Chart 1: Long-term weekly chart illustrating the macro trend, 2007 resistance and a negative divergence from the RSI.
Chart 2: Outlines a potential bearish head and shoulders pattern, which if triggered, will probably coincide with a confirmed break of the primary bullish support line on the weekly chart. Trigger: confirmed break of the neckline, at $58 Target: Minimum expected price objective is $51, Protective Stops: confirmed move back above the neckline.
UPDATES:
CREE INC. (CREE): Market Letter 3/15/11 – There was a significant gap-down with a surge in volume on bad news yesterday. Resistance should now be provided by the lower end of the gap, at $46.36. Protective stops may be trailed down to trigger on a daily close above $49.
HAVE A GREAT WEEKEND!
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*DISCLOSURE: Short CREE, AMP
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