MS posted a new YTD low at 14.71 (12 Sep) while sliding within a multi-week wedge. The potential bullish divergence of RSI studies on the daily chart (from 08 Aug/12 Sep lows) suggests that a near-term bottom cannot be ruled out. A break above 16.40 (
Resistance 1). near the upper bounds of the wedge would neutralize the immediate weakness, promoting further recovery towards 17.73 (
Resistance 2) ahead of 18.89 (
Resistance 3).
However, a breakdown below 14.71 (
Support 1) would negate and initiate the next leg-down towards 13.83 then 13.10 (21/20 Jan 2009 lows,
Support 2/3).
Trading Indication:
Short-term (Intraday):
Buy at 14.90 or lower;
Target at 17.73 and higher; Stop Loss at 14.70 (1.7%)
Long-term: Possibly sell higher
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