Investment fund Softbank (JP:9984) ( SFTBY) is the ultimate unicorn investor ("unicorn" is the term used in the venture capital industry to describe a startup company with a value of over $1 billion.) Not all of their investments have turned out positive, though, and its charts could be warning of further economic weakness ahead.
Let's check out two charts.
In this daily bar chart of the Japan-listed shares, JP:9984, below, I can see a "round trip" from the low in early October to a high in November and back down to the prior October low around 4,800. Softbank trades below the declining 50-day moving average line and below the cresting 200-day moving average line.
The On-Balance-Volume (OBV) line shows weakness from early February. The Moving Average Convergence Divergence (MACD) oscillator is in a bearish alignment below the zero line.
In the weekly Japanese candlestick chart of Softbank, below, I see a disappointing picture. Prices are trading below the declining 40-week moving average line. The candles do not show me a bottom reversal pattern and do not show me lower shadows.
The weekly OBV line shows weakness from early November. The MACD oscillator has recently crossed below the zero line for an outright sell signal.
Bottom-line strategy: The charts of Softbank look weak and probably headed lower. I consider weakness in Softbank's shares another sign of slowing economic conditions and restrictive monetary conditions. A break of the 4,500 area will probably precipitate further declines.
Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.
Japan's service sector is growing at a record rate, according to recent data, while services are also the saving grace in China, where manufacturing has begun to lag.
Chinese stocks are approaching bear territory, with the Hong Kong market at its lows for the year as Telsa's CEO gets the star treatment in Beijing and Shanghai.
Pro-democracy parties have won handily in Sunday's Thai elections and must now form a coalition. The question is, can it govern?
Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation.
If you have questions, please contact us here.
Email
Email sent
Thank you, your email to has been sent successfully.