From around mid-July 2019, the Cisco System Inc stock (NASDAQ: CSCO) drifted lower until it found support near the 43.40 hurdle in the beginning of December. From there, the share price managed to rise and establish a short-term tentative upside support line taken from the low of December 5th. But at the same time, CSCO ran into some heavy resistance near the 48.41 mark, which is just slightly below the 200-day EMA. Although there are a few signs indicating that we may see a continuation move to the upside, still, until we see a clear push and a daily close above one of our key resistance levels, we will remain cautiously bullish.
In order for us to get comfortable with higher areas, we will wait for a daily close not only above the 200-day EMA, but also above the 48.97 mark, which is the highest point of November. This way more buyers might see it as a good opportunity to join in and drive the price to the next potential area of resistance, at 50.29, marked by the highest point of September. The stock may stall around there for a bit, or even correct back down slightly. That said, if CSCO continues to trade above the aforementioned upside line, we will remain positive, at least in the near term. Another uprise might force the 50.29 hurdle to surrender to the buyers, and if so, then the next target could be the 52.03 level, marked by the inside swing low of August 9th and the high of August 14th.
Looking at our oscillators, the RSI and the MACD, one is more in support of the upside than the other. The RSI is above 50 and points higher, while the MACD is somewhat flat. At the same time, the MACD is above zero, but below its trigger line. That said, we believe that there is still a chance to see a bit of upside in the near future.
Alternatively, if the previously-discussed upside line breaks and the price falls below the 46.80 zone, which is the current low of this month, we may end up seeing a further slide, as a few existing investors might get anxious about the stock’s potential positive performance in the short run. This may force them to get rid of some of their existing positions, which could send CSCO to the 45.92 obstacle, a break of which could clear the path to the 44.37 level, marked by an inside swing high of December 9th.
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