A regular DecisionPoint webinar viewer and reader emailed me and suggested I take a look at AT&T because as he stated, "ouch". It was definitely a rough day for AT&T and what happened today has some very interesting implications.
Price dropped almost 2% today. It came right after the negative divergence materialized between price tops and OBV tops. It also came after two unsuccessful tests of overhead resistance. The Price Momentum Oscillator (PMO) triggered a SELL signal as it crossed below its signal line today and also pierced the 20-EMA. Optimistically, price could find support at $40.50, but given the location of the PMO SELL signal and declining SCTR, I suspect it will drop much further.
The weekly chart could be positive given the rising PMO, but noting that price turned down at all-time highs after an unsuccessful test of resistance is a problem. The long-term implications could mean a move all the way down to $36, but I'd need to see the weekly PMO at least top and have a crossover SELL signal before I got that pessimistic. At this point, a move to $40.50, suggested by daily chart horizontal support seems likely.
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