Don't Ignore This Chart!

Seagate Rises from the Ashes


Seagate Technology was one of the weakest tech stocks in 2018 as it fell around 40% from the April high to the October low. Things appear to be turning about here in 2019 as stock finds its footing and triggers two breakouts.

The chart below shows STX with two lows in the 36 area and a double bottom pattern in play. The peaks between the lows mark resistance (red zone) and the stock broke out with a surge in late February.

The broken resistance zone in the 44-46 area turned into support, and held. Notice how STX fell back to this zone after the breakout with a small falling wedge. The stock held support here with a nice reversal day on Friday and follow through on Monday.

The indicator window shows RSI moving above 70 for the first time since March 2018. There is also a bullish failure swing in play. Notice how RSI held above 30 on the December dip and broke out in late January.

Overall, it looks like STX is reversing its downtrend. Broken resistance turns support and I would consider this breakout valid as long as 44 holds.  

Correction Mode and Targets

  • Small-Caps Extend Lower (plus SPY and QQQ)
  • 90% Down Days for Finance and Healthcare
  • Some Key Industry Group ETFs Fail at 200-day SMA
  • Bonds ETFs Remain in Bullish Consolidations
  • Scanning for Outliers (gains/losses)
  • Click here to Watch

- Arthur Hill, CMT

Senior Technical Analyst,

Book: Define the Trend and Trade the Trend
Twitter: Follow @ArthurHill

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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