Don't Fight Xerium Technologies' Tape, New Lows Are Expected

 | Mar 29, 2016 | 9:25 AM EDT
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Kick 'em while they are down? Xerium Technologies (XRM) was downgraded by TheStreet Ratings quant service and has a bearish chart.

In this daily chart of XRM, above, we can see a persistent downtrend in effect the past year. Prices are well below the declining 50-day and 200-day simple moving averages. The On-Balance-Volume (OBV) line is pointing down, and tells us that, even at these relatively low price levels, sellers of XRM are more aggressive with volume heavier on days when XRM closes lower. In the lower panel, we fail to find any bullish divergences to suggest a turnaround. 

In in this weekly chart of XRM, above, we can see the result of the decline. Prices remain below the declining 40-week moving average line. The OBV line is weak on this time frame too. No bullish divergences to rescue. Prices are likely to test, and probably break, the 2012 lows. Don't fight the tape! 

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