Vodafone (VOD) isn't far off from the setup in MGM; the $187 billion mobile phone carrier is currently forming a rounding top. Rounding tops look just like they sound; they indicate a gradual shift in control of shares from buyers to sellers. But while the price action at the top may be gradual, the break below support tends to be a lot more abrupt.
For VOD, the breakdown level to watch is $36.Momentum adds some confidence to the VOD trade. 14-day RSI, our momentum gauge, has been trending lower since shares started topping. That means that down days in VOD have been a lot more forceful than up days since December. The downtrend in RSI is getting tested this week. Based on previous price action, that increases the chances that VOD's share price will be swatted lower in the near-term.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV