Consumer finance ($DJUSSF) recently broke below key price support at 170 and did so on heavy confirming volume. To make matters worse a key component - American Express (AXP) - disappointed Wall Street after Thursday's close with its quarterly earnings report. Bottom line results beat consensus estimates, but revenue came in a bit light. AXP was under pressure throughout the day on Friday and was a major reason why the Dow Jones gained just half of the NASDAQ's gain. Below is a chart showing the breakdown of the DJUSSF, along with its next key price support level:
The bottom half of the chart shows that AXP has been underperforming its peers in the consumer finance space for the past 18 months. Until this downtrend line is broken, I'd avoid AXP shares.
Happy trading!
Tom
