Fitterling said that the market is full of fear, uncertainty and doubt, which has led to their depressed share price and outsized dividend yield. He said Dow has been strengthening their balance sheet. The company currently has $2.4 billion in cash, more than enough to pay their dividend.
Let's check and see how the charts are faring Tuesday.
In the daily bar chart of DOW, below, we can see that the stock had declined from around $55 in the November/December period to below $25 in the past few days -- a 50% decline in just a few short months. DOW is below the declining 50-day moving average line and the declining 200-day line. We even see a bearish dead or death cross of these two popular lagging indicators.
The On-Balance-Volume (OBV) line peaked in late December and its subsequent decline confirms that sellers of DOW have been more aggressive. The 12-day price momentum study shows lower lows this year so far so no bullish divergence telling us that the decline has slowed.
In the daily Point and Figure chart of DOW, below, we can see that prices have met and exceeded their downside price target of $27. Prices look like they are now starting to stabilize.
Bottom-line strategy: Dow has found some buying interest in the $24-$22 area. I have not yet seen a reversal pattern but we may get a two-day reversal pattern Tuesday -- a low close followed by a high close. Buyers get ready.