For me, many bearish charts come down to anticipation rather than confirmation. As we often talk about the market taking the stairs up and the window down, the same can be said for stocks. Therefore, a bearish list will often include possible bearish moves. The charts are bearish because they have potential once they trigger, but my lists are populated with names close to a trigger, but not quite there yet. Equinix (EQIX) is a great example of this idea.
EQIX's daily chart has that lower left to upper right price movement associated with bullish stocks; however, the movement in June hasn't been rewarding for bulls. Note now how the $255 level was support for the breakout in May and now acts as resistance to the breakdown in June.
Like SodaStream (SODA) earlier this morning, we get a head-and-shoulders pattern, but this time bearish. The difference maker for EQIX is the uptrending support line from March. While yesterday's neckline break looked like it could be the beginning of the end for EQIX, ignoring the second support line would have been a big mistake. EQIX needs to close under both support lines for a solid trigger. We already see the relative strength index (RSI) under 50, indicating a bearish momentum and the Force Index in the red. These are valid concerns and should elevate EQIX on the bearish watch list. The minimum downside target here is $245, although the measured move is at $235.
The support line referenced in the daily chart becomes more evident on the weekly chart. Here, we lose the bearish head-and-shoulders pattern and replace it with a rising wedge. These tend to lean bearish, but aren't the strongest of patterns. Still, it is worth a note given the breakdown we are seeing in the moving average convergence divergence (MACD) indicator as well as the fact that RSI is losing its trend line. Momentum and trend are both pushing lower in front of price testing a support level. Again, enough to put EQIX on our bearish watch list.
A weekly close under $255 sets up a possible move all the way down to $220. There is support in the $235-$240 range which doesn't come as a surprise if one was already familiar with the daily charts.
Overall, EQIX isn't a short or put buying play yet. However, this one has solid potential if a trader is willing to watch and wait for the noted triggers.