Emerson Electric (EMR) was downgraded by TheStreet's Quant Ratings service and this highlights the bearish technical condition of EMR.
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Shares of EMR peaked in May (chart above) and then had a deep decline. From an October low, EMR only had a modest recovery bounce and volume was not behind the rally. Without a pickup in the On-Balance-Volume (OBV) line, the charts is back down, flirting with support at $45. This support isn't looking so strong with the Moving Average Convergence Divergence (MACD) in a negative configuration and the 50-day and 200-day moving averages pointing down.
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This longer-term chart of EMR, above, is not promising. Prices for EMR are below the declining 40-week moving average. On this timeframe the OBV line was declining for all of 2015, which signals a lot of selling/liquidation as volume was heavier on weeks when EMR closed lower. The MACD oscillator is bearish and below the zero line.
A break of $45 can mean a test of support from 2011 at $40. The older the support (or resistance), the less reliable it can be. The market has a memory but the farther back you go, the "fuzzier" it gets. If the $40 does not hold for EMR, then prices could revisit the $30 support level longer term.
