Akamai Technologies (AKAM) was upgraded by our quantitative service today. That is one leg of the three-legged stool (quantitative, fundamental and technical). Let's see what the charts can add.
AKAM lost nearly half its peak price in a few months. It wasn't until February that it managed a quick rebound. After this bounce, AKAM traded sideways. Prices may have stabilized but technicians also like to see volume confirm the price action. Volume since the February low has been dull and the On-Balance-Volume (OBV) line has been flat. In the lower panel is the momentum study and it fails to show any bullish divergences between price and the rate of change of price.
The weekly chart of AKAM, above, does not suggest something different from the daily chart. Prices are below the declining 40-week moving average line. The OBV line on a weekly time frame shows some lift, however. The Moving Average Convergence Divergence (MACD) oscillator gave a cover-shorts buy signal but has since narrowed below the zero line. This narrowing could lead to a new sell signal.
Conclusion: The quant upgrade is interesting but it is not enough (yet) to prompt a long position. Buyers of AKAM need to show their enthusiasm in the volume first."