Hewlett-Packard (HPQ) is another name that can't seem to do anything right lately. While value investors may find it tempting to buy when stocks get cheap, buying the dips in HP has been hazardous to investors' health this year. Shares of the computer giant are down a staggering 43% in 2012, and the stock hasn't shown any technical signs of a reversal yet.
HP has been locked in a downtrending channel for the better part of the year, bouncing in between a trendline support level to the downside and trend line resistance to the upside. Those two parallel lines have provided traders with a decent "high-probability range" for HPQ, giving short sellers good opportunities to sell the stock right at resistance.So even though this stock seems to be catching support right now, investors shouldn't view any sort of bounce as a buying opportunity. If anything, it's a chance to sell off your shares at a better price than you're likely to get later. Until this stock pushes through trend line resistance, I'd recommend staying well away from Hewlett-Packard's long side. For another take on HP, it shows up on a list of 5 Stocks to Store Away for 5 Years. I also featured it in "5 Stocks Seth Klarman Loves."
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