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International Business Machines
Ticker: NYSE:IBM
Price: $131.49
Company News
IBM (IBM) plans to spin off a $19 billion technology consulting business so it can focus more intently on cloud computing and artificial intelligence, the company said Thursday. IBM stock jumped on the news.
The business unit, called Managed Infrastructure Services, will be spun off into a new public company. It helps companies manage their technology infrastructure. IBM sees it as a tax-free deal completed by the end of next year.
In addition, IBM provided its revenue and earnings outlook for the third quarter that were in line with Wall Street expectations.
The announcement comes as IBM has undergone a long and massive restructuring.
IBM Stock Jumps On Announcement
IBM stock climbed 6%, closing at 131.49 on the stock market today. Shares are rapidly approaching a 135.98 buy point.
The new company plans to focus on managing and modernizing client-owned infrastructures, a $500 billion market opportunity. It will provide hosting and network services, infrastructure modernization, and cloud migration services.
The multiyear transformation of IBM has focused on developing and expanding what IBM calls an open hybrid cloud platform.
“IBM is laser-focused on the $1 trillion hybrid cloud opportunity,” Chief Executive Arvind Krishna said in written remarks with the announcement. Krishna took the reins as CEO in April, succeeding Ginni Rometty.
A hybrid cloud architecture means IBM can provide its customers with both a public cloud and a private cloud, which gives a company extra network security. They share data and applications between them.
It’s among the reasons IBM acquired Red Hat in 2018 in a $34 billion deal. Red Hat provides an open source, cloud software business.
Business Summary
International Business Machines Corporation (IBM) is a technology company.
The Company operates through five segments: Cognitive Solutions, Global Business Services (GBS), Technology Services & Cloud Platforms, Systems and Global Financing.
The Cognitive Solutions segment delivers a spectrum of capabilities, from descriptive, predictive and prescriptive analytics to cognitive systems. Cognitive Solutions includes Watson, a cognitive computing platform that has the ability to interact in natural language, process big data, and learn from interactions with people and computers.
The GBS segment provides clients with consulting, application management services and global process services.
The Technology Services & Cloud Platforms segment provides information technology infrastructure services.
The Systems segment provides clients with infrastructure technologies.
The Global Financing segment includes client financing, commercial financing, and remanufacturing and remarketing.
Price Performance
Relative Valuation
Technical Indicators
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
The projected upper bound is: 137.15.
The projected lower bound is: 126.08.
The projected closing price is: 131.61.
Candlesticks
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 25 white candles and 25 black candles.
A long upper shadow occurred. This is typically a bearish signal (particularly when it occurs near a high price level, at resistance level, or when the security is overbought).
A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend. There have been 3 rising windows in the last 50 candles–this makes the current rising window even more bullish.
Momentum Indicators
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
Stochastic Oscillator
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 73.4146. This is not an overbought or oversold reading. The last signal was a sell 5 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 70.47. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 85 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 352.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 8 period(s) ago.
MACD
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 5 period(s) ago.
Momentum Indicators
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
Stochastic Oscillator
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 73.4146. This is not an overbought or oversold reading. The last signal was a sell 5 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 70.47. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 85 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 352.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 8 period(s) ago.
MACD
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 5 period(s) ago.
Rex Takasugi – TD Profile
INTL BUS MACHINE closed up 7.420 at 131.490. Volume was 430% above average (trending) and Bollinger Bands were 3% narrower than normal.
Open High Low Close Volume 130.860 135.500 129.770 131.490 25,288,926
Technical Outlook Short Term: Neutral Intermediate Term: Bullish Long Term: Bullish
Moving Averages: 10-period 50-period 200-period Close: 122.45 123.46 125.75 Volatility: 35 28 53 Volume: 5,301,976 4,179,944 5,470,961
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
Summary
INTL BUS MACHINE gapped up today (bullish) on heavy volume. Possibility of a Breakaway Gap which usually signifies the beginning of a major market move. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
INTL BUS MACHINE is currently 4.6% above its 200-period moving average and is in an upward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect moderate flows of volume into IBM (mildly bullish). Our trend forecasting oscillators are currently bullish on IBM and have had this outlook for the last 1 periods. Our momentum oscillator is currently indicating that IBM is currently in an overbought condition.
