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May 10, 2006
Bearish Candlesticks For Sandisk
Sandisk rebounded after a sharp decline earlier this year, but bearish candlesticks over the last few months could foreshadow a reversal soon. The current advance retraced 50% of the prior decline and the stock met resistance around 60 four times in the last five weeks. A shooting star formed in early April (blue oval), a bearish engulfing in early May (gray oval) and another shooting star formed yesterday (red oval). There is clearly a lot of selling pressure just above 65, but the stock has yet to break down and confirm these bearish candlesticks. For confirmation, I would look for a move below the early March trendline (blue) and early May low (60). This is a volatile stock and trading is best suited for nimble players that can tolerate the risk.
Posted by Arthur B. Hill at May 10, 2006 07:06 AM