I was running through some charts today and came across and interesting setup - in Xerox of all names. It has been a long time since Xerox crossed my path. The company provides document management solutions with both hardware and services. It is a $7.2 billion company and part of the S&P 500. Based on the chart, things may be looking up. The stock broke out with a gap and surge in January and hit a 52-week high in February. After a 30+ percent gain, the stock was ripe for a correction and it fell back to the 6.90 area in April. Notice that a falling channel of sorts formed and the stock retraced around 38% of the prior surge (sans spike). There are signs that this correction may be ending because MACD turned up the last few weeks. A resistance breakout would complete the reversal and argue for a continuation of the bigger uptrend. Note that Xerox is a low-priced stock and this means it carries above average risk.
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--Arthur Hill CMT
Plan your Trade and Trade your Plan
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