Hewlett-Packard, symbol (HPQ) has been struggling of late, at least when you are watching the price action of the chart this year. The maker of personal computers, printers, enterprise networks and storage, as well as software has had a rough start with shares down some 20% plus year to date.
Before you start talking “Value” or “Buy Low”, take a look at a chart that shows a different view!
$HPQ has formed what looks to be a bearish Head & Shoulder top. The Neckline has been broken and we are now witnessing a move back up in price to the neckline (often the case in this pattern), before a resumption in the downtrend.
We are keeping an eye here to see if the neckline will now become resistance and if so, would look to the low 20’s as a reasonable price objective. BTW, the Point & Figure vertical count suggests the same price objective area.
A move above the neckline would change our idea from a technical perspective and dictate this pattern as a failed pattern.
Good Luck and Happy Independence Day!