FireEye (FEYE) has traded sideways in recent months in a relatively tight range. Sometimes investors use sideways periods to accumulate shares but we are not seeing signs of accumulation or base-building at this juncture.
In this daily chart of FEYE, above, we can see a low in February and a retest in May. After the retest in May FEYE could have started an uptrend but rallies since have failed to overcome resistance in the $18-$20 area. Prices have crisscrossed above and below the flat to declining 50-day moving average line. A rally to the underside of the declining 200-day line at the end of July capped one upside attempt and another bounce earlier this month stopped short of the average line.
Volume is no help for the bulls. Two volume surges came when prices gaped to the downside signaling a desire to liquidate longs. The On-Balance-Volume (OBV) has basically been on the defensive all year suggesting that sellers are more aggressive. On the plus side there is a small bullish divergence between the lower lows in price in August and September and higher lows from the momentum study (lower panel). Despite these bearish observations, FEYE has not made a new low since February. FEYE may be sticky on the downside but that is not enough of a reason to become bullish.
The weekly chart of FEYE, above, is not encouraging. Prices are below the declining 40-week moving average line. The weekly OBV line has been neutral all month and the MACD oscillator is below the neutral zero line.
Bottom line: We'll stay on the sidelines but a close above $19 on FEYE, should it happen, would quickly turn our short-term chart bullish.