Citrix Systems (CTXS) peaked in early May and has been weakening since. Prices have been rolling over the past four to five months and bouncing off a "neckline" around $78. Is this a small top formation or a consolidation pattern before renewed gains? Door No. 1 or door No. 2?
Prices are poised to either rebound or probe lower -- let's take a closer look at the indicators before I tell you my bias.
In this daily bar chart of CTXS, above, we can see prices are in a "neutral zone" below the declining 50-day moving average line and above the rising 200-day moving average line. On the plus side as prices have rolled over from February, the On-Balance-Volume (OBV) line has been steady, or neutral if your prefer. So despite a decline, the past two months the line has been steady -- sellers have not been aggressive.
In the lower panel, the momentum study shows higher lows in May and June as prices made lower lows. This is a bullish divergence and could signal a rebound ahead.
In this weekly bar chart of CTXS, above, we can see prices are above the rising 40-week moving average line. A test of this line could happen in the weeks ahead. The weekly OBV line shows a strong rise and aggressive buying from early 2016, but the line has turned sideways the past four months. The weekly Moving Average Convergence Divergence (MACD) oscillator crossed to a take-profits sell in May.
In this Point and Figure chart of CTXS, above, we can see an uptrend that has turned weak. A trade down to $77 would be a new low on this chart and could open the way for further declines, but support can be seen starting at $75. A rally to $84 may be needed to get this chart looking more positive.
Bottom line: With a bullish divergence from the momentum indicator, I would lean to the bull side and look to buy strength above $83 and $84 and then risk a close below $78.