IBM Technical Analysis (NYSE:IBM)
Technical analysis relies on the belief that future price movements of a stock can be forecasted through the study of historical market data and technical charts. Just by looking at the IBM stock price one can't take a trading decision. A trader needs to find a chart pattern, which is a clear cut pattern formation on the IBM stock chart which creates a trading signal.
See IBM bollinger bands, SMA - 200 day moving average, 50 day moving average and exponential moving averages. The technical analysis form of IBM stock analysis tries to understand the market by studying the stock market trend itself as opposed to other aspects like the company's fundamentals.
IBM Moving Average
Moving averages show the average price of IBM stock over a set time period and help traders see the overall trend by smoothening out the daily variation in price movement. The 20 day moving average of $146.63 is below the last closing price of $149.06 and the 50 day moving average of $145.92 is below the last closing price of $149.06. The 10 and 20 day periods can predict short term moving average trends.
IBM Bollinger Bands
Bollinger bands comprise of a center line usually IBM SMA, and two IBM stock price bands above and below it. The stock is considered overbought when the price starts moving closer towards the upper band, and is considered oversold as stock price moves closer towards the lower band. Currently the stock price of $149.06 is in the upper range of IBM bollinger bands.
IBM Moving Average Convergence Divergence or MACD
The moving average convergence divergence or MACD is a technical indicator which helps gauge the stock price trend, as the indicator is useful in understanding the strength, direction and momentum of the stock price. The IBM MACD line is above the signal line.
IBM Relative Strength Index
The relative strength index compares the magnitude of recent gains to recent losses and is a momentum indicator. It attempts to assess overbought and oversold conditions of a stock. If the RSI of IBM stock goes above 70 it could indicate an overbought condition, and if it goes below 30 it could signal an oversold position.