INTC: Coulda Seen it Coming

If you knew absolutely nothing about the company Intel, but knew just the basics of chart patterns and Fibonacci patterns, today’s sharp pullback would have come as no surprise. In fact, you could say the same thing about the past 25 years.

Note that 69.29 was only 75 cents away from an 88.6% retracement (a bat pattern) and occurred at the top of an eleven year-old channel. Easy pickings.

The subsequent drop would normally be to a lower Fib level which, in this case, was the 50% retracement. It also lined up with the bottom of the white channel. Also, easy pickings.

The rebound back to the 88.6% retracement was only slightly tricky. It was in essence a double top, which are usually hard to anticipate. In any case, once the double top occurred, the subsequent drop was almost exactly to the 78.6% Fib retracement (not shown.)

The rebound from there to its recent highs, however, was almost exactly a 61.8% retracement (44 cents off, again easy pickings.)

Volumes have been written about how/why chart patterns and Fibonacci patterns work. It makes for interesting reading. But, for those who don’t care how the watch works and just want to know what time it is, it’s good info to have.

Speaking of which, if INTC doesn’t recover to at least the bottom of the little purple channel below (45.50ish), things could get much worse.

Stay tuned…

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