AT&T Shares Not Likely to Rise in Intermediate Term

 | Feb 14, 2017 | 1:29 PM EST
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AT&T (T) sold off from August to November last year and then in about six weeks recouped most of the decline. Since early January T has been correcting that rapid rally and it doesn't look over yet.

In this daily bar chart of T, below, you can see that T gaped lower in early January and this gap was filled in early February. Prices are below the rising 50-day moving average line and the upward sloping 200-day average line is being tested.

Volume does not seem to have a trend but the On-Balance-Volume (OBV) line has been mostly positive since January. The Moving Average Convergence Divergence (MACD) oscillator is right on the zero line and could give us an outright go-short signal soon.

In this weekly chart of T, above, we can see that prices are right on the rising 40-week moving average line. The weekly OBV line has been moving sideways to a little lower since July and the MACD oscillator is poised to cross to a fresh liquidate-longs sell signal.

Bottom line: With neutral to bearish chart signals on the daily and weekly time frame, T is likely to trade sideways to lower until more aggressive buying occurs. I would be prepared for a $42 to $38 trading range for the intermediate-term.

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