IBM (IBM) is "blue," or "in the red," if you prefer -- still grinding lower after a serious gap to the downside last month. The pace of the decline has not slowed to reveal a bullish momentum divergence, so we and Warren Buffett are probably going to see a test of the October/November lows.
Warren might be taking some questions about IBM this weekend. I doubt if he will be consulting the charts, but we can.
In this daily bar chart of IBM, above, we can see the big April gap after IBM had turned down below the 50-day moving average line. The rising 200-day line was broken on the gap day and now the line is flattening. Prices are still moving lower with sellers still more aggressive as the On-Balance-Volume (OBV) line is still edging downward.
In the lower panel is the 12-day momentum study and the momentum readings are mirroring the price action with lower lows. A bullish divergence from the momentum indicator would be helpful.
In this weekly chart of IBM, above, we can see that this is the third week below the 40-week moving average line and the slope of the line is turning flat. The weekly OBV line has been down for three months and the MACD oscillator could be on its way to cross below the zero line for an outright sell signal.
Bottom line: Unless a reversal develops soon it looks like IBM could retest the $150 area or the November/December low. For now, I would anticipate that the level holds and Warren does the same.