Don't Ignore This Chart!

Tibco Establishes Support with Rare Red Hollow Candle


Tibco Software (TIBX) has been all over the place the last five weeks. The stock gapped up in late May, gapped down in early June, bounced to 21 and then gapped down again last Friday. Despite all this volatility, the stock may be at support now. Notice that a rare red hollow candlestick formed in early June. These form when the close is below the prior close, but the close is above the open. Essentially, TIBX opened near the low (18.21) and then bounced to close above 19.5. The high volume day also reinforces the idea of support in the green zone. Most recently, the stock gapped down again last week, but firmed on Monday with an inside day so far. The body of the current candlestick is within the body of the prior and this means a harami could form. Harami signal indecision and this further affirms support in the 18.5-19.5 area. It is a big area, but the bounces since mid April make it so. 

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Arthur Hill
About the author: , CMT, is the Chief Technical Strategist at Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed market technician. Arthur has written articles for numerous financial publications including Barrons and Stocks & Commodities Magazine. In addition to his Chartered Market Technician (CMT) designation, he holds an MBA from the Cass Business School at City University in London. Learn More
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