Intercontinental Exchange, or (ICE) for short (which is also the stock symbol) is pulling back. The question for market watchers is how far and how long.
In this daily chart of ICE, above, we see a gap up in May that was eventually filled and one in August that is also likely to be filled. ICE has declined below the rising 50-day moving average line but remains above the rising 200-day line which intersects down around $255.
There are two divergences to point out. One is from the On-Balance-Volume (OBV) line, which makes a lower high in September while prices make new highs. The second bearish divergence is from the Moving Average Convergence Divergence (MACD) oscillator, which made a lower high in August vs. June and is poised for an outright sell signal as prices are near the zero line.
The $270-$265 area has acted as resistance for much of the past 12 months but it may not provide that much support as the time spend in this zone was actually limited.
In this three year chart of ICE, above, we can see that the 40-week moving average line has done a good job defining the uptrend. Prices are above the rising 40-week line. The weekly OBV line is pointed up but volume has actually slowed for much of 2016.
In the lower panel is the MACD oscillator on a weekly timeframe and it is poised for a new liquidate longs sell signal.
Strategy: ICE is pulling back and should retest the $265 area. If this area does not stop the pullback then a deeper correction is likely.