Technical Analysis of Financial Markets

Thursday, August 09, 2007

Intel Corp. (INTC)

Manufacturer of semiconductor chips, microprocessor CPUs and flash memory, Dow component Intel, has rallied 30% in a 5-month period from year-to-date lows. Price action may currently be consolidating into a speculative bearish Head & Shoulders top formation. Technically, confirmation of the pattern occurs on break of the Neckline support after formation of the right Shoulder. A price target of the pattern can be derived by calculating the distance from the Head to the Neckline and then projecting this distance downwards beneath the Neckline support. This evaluates towards the 200-day moving average; a signal for institutional traders. Stop-loss: a close above the 50% Fibonacci extension may signal a failure of the right Shoulder; and thus the complete formation. In recent news, Intel executive Robert Baker sells 560,239 shares, offloading at an average price of $24.14: