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Oracle (ORCL)  just reported earnings and while the numbers for the quarter were strong, the company said it expected the acceleration in revenue to slow in the second fiscal quarter.

Founder Larry Ellison's remark during an earnings call that, "There's no one left to buy," may have further suppressed growth expectations. Cloud revenue was up but it only accounts for 16% of Oracles top line. 

Investors should be aware of support levels because they mark the borders of former upside gaps. These gaps become support vacuums on the way back down, often acting like "air pockets" that cause the stock price to drop suddenly and sharply.

The stock rallied nearly 40% this year, but not in a steady rise above a well-defined trendline. Rather was saw fits-and-starts of gap breakouts, followed by unstable periods of consolidation. Recently, Oracle broke above the most recent level of consolidation resistance but did not gap higher. In last Thursday's session, a small doji, or narrow opening and closing range candle formed on strong volume, which can be interpreted as representing a lack of trader conviction.

The relative strength index has recently returned to an overbought condition, and while the moving average convergence/divergence oscillator recently made a bullish crossover, it did not make a new high along with price. This is considered a bearish divergence and a technical warning sign.

The bottom line is to mind the gaps.

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This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.