|2/26/99 Intel Corp (INTC)
Points to watch: Before this week's fall, Intel
had been weakening technically since peaking in January. Daily RSI showed a strong
negative divergence with price at the top and has been in a downtrend since early January.
OBV turned down in early January. This week's decline saw Intel break below
many key support levels. On Thursday INTC moved below its 55 day moving average
(127.69) for the first time since the stock crossed above it in mid-October.
INTC also broke below Gann support at 126.1 which had held throughout February.
Friday Intel broke below the 25% retracement level (125.6, 25% retrace of 9/98-1/99
rally) which had held since the beginning of the year. The stock also broke minor
support at 122.6. INTC is short term oversold and a bounce in the stock
price is possible Monday, but it will likely only be a short lived rally. Weekly
MACD and stochastics have given sell signals. There is minor support from 115.7 (38%
retracement level) to 117.1 (Gann). Major downside support exists at 105-107 (50%
retracement level). On a break of the 105 level INTC would next find support at 99
(38% retracement of 1/96-1/99 rally). Continue to hold Intel, and avoid shorting
until the stock breaks below the 115-117 support level.