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The Cboe Global Markets ( CBOE) turned sharply lower Monday and the stock was downgraded by TheStreet.com’s quantitative service, despite an earnings beat on Friday. The name is also a holding in the AAP portfolio, so let’s check the charts.
In this daily bar chart of CBOE, below, we can see that prices quickly reversed to the downside after generating a number of buy signals. Prices were trading above the 200-day moving average line and then quickly plunged below to retest the rising 50-day moving average line. The On-Balance-Volume (OBV) line shows some improvement from May, but also a recent turn to the downside. The Moving Average Convergence Divergence (MACD) oscillator is above the zero-line, but just crossed to the downside for a take-profit sell signal.
In this weekly Japanese candlestick chart of CBOE, below, we can see that the most recent candle plot was a doji, which can be a top-reversal pattern. Prices are above the 40-week average line in this picture, but are currently trading below it. The OBV line shows weakness from December. The MACD oscillator is close to crossing the zero-line but this strength may be short-lived.
In this daily Point and Figure chart of CBOE, below, we can see an upside price target in the $139 area. A trade at $114.23 may weaken this chart.
In this weekly Point and Figure chart of CBOE, below, we can see a potential price target in the $166 area.
Bottom line strategy: An exchange should do well when activity spikes higher, but right now it looks like the CBOE can correct further to the downside.