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IBM (IBM) - Get International Business Machines Corporation Report has rebounded nicely off last week's low. The stock's steep slide off the early November high, which dropped shares to fresh 2015 lows, bottomed just above $132 on Friday, Nov. 13. The following Monday, IBM began a steady rebound that by the end of the week had carried shares past the October lows. For frustrated bulls, last week's rally should come as quite a relief. The basing action continues to improve this week.

During the initial stage of the early November selloff, IBM was hit with a fairly heavy selling wave. The volume surge on Nov. 9 drove the stock below the October low and into fresh 52-week-low territory. After a one-day pause, IBM began to fall again but with far less momentum. The stock was beginning to show signs of downside exhaustion just as a divergent moving average convergence/divergence was taking shape. The rebound that followed now appears to have left behind a significant bottom neat last week's low. IBM has more work to do, but the picture is turning much more positive in the near term.

IBM investors should consider the $135-to-$137.50 area as a low-risk buy zone. If the rally that began last week is to remain intact, the stock should hold in this area. The key over the next few sessions will be a move past the $141 level. Once past this heavy resistance, which includes the August low, the stock will have cleared a big hurdle.

On the downside, a close back below $134 will send a clear warning sign that more basing will be needed before a significant recovery can take hold.

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