Agriculture equipment manufacturer and distributor AGCO (AGCO) was downgraded to "hold" by TheStreet's Quant Ratings and, frankly, its chart is not attractive.
In the daily chart of AGCO, above, prices have fallen below the 50-day and the 200-day moving averages. The On Balance Volume (OBV) line has turned down from a March high. This suggestest that sellers are being more aggressive with volume higher on days when AGCO closed lower. There is also no bullish divergence from the momentum study.
The combination of weak or weakening indicators suggests we could see more testing of the support in the $48 to $44 area.
In the longer-term chart, above, we can kind of see two trends. Prices are down from the 2013 high, but prices have also been in a sideways trend. Prices are now below the declining 40-week moving average line. The OBV line has been down for several months telling us that aggressive selling has been underway for a while. Last, Moving Average Convergence Divergence (MACD) oscillator is basically neutral right now.
All things considered, we would either be standing aside AGCO or short, looking to add to shorts below $44.