We looked at Autodesk (ADSK) only a few weeks ago and we concluded, "ADSK is probably going to close higher on the day (Monday) and some observers will be quick to declare that the coast is clear. I would go slow and not be too fast to declare victory. The key for me will to see prices and the OBV line going up together again."
Jim Cramer included Autodesk in today's list of top tech stocks. Let's take a closer look:
In this updated daily bar chart of ADSK, above, we can see prices steadied after June 12 for a few days, but subsequently slipped lower to close below the rising 50-day moving average line. The price action and the OBV line did not move up together as we pointed out in the June 12 update. The daily On-Balance-Volume (OBV) line peaked in late May and has moved sideways to lower since. The Moving Average Convergence Divergence (MACD) oscillator is crossing the zero line for an outright sell signal.
In this weekly bar chart of ADSK, above, we can see prices are above the rising 40-week moving average line, maybe too far above. The price gap on the daily chart disappeared on this weekly chart. The weekly OBV line shows a peak in May and some weakness since. A declining OBV line tells us that sellers of ADSK have become more aggressive. The weekly MACD oscillator is crossing to a take-profits sell signal.
In this Point and Figure chart of ADSK, above, we have a downside price target of $91.
Bottom line: ADSK has filled most of the price gap made in May. Weakening daily and weekly charts point the way still lower. I would anticipate that ADSK erodes into the $95-$91 area.
