Technical Alert: IBM Successfully Pierces Through its Price Resistance


  • International Business Machines Corp (NYSE: IBM) gained 3.90% percent in the last trading session.
  • Post breaking out of a crucial resistance level the stock hit a new 52-week high.
  • The stock has broken the rising channel pattern on the daily chart and getting major support from the 50-period simple moving average.
  • On the weekly chart, the price has broken out of an ascending triangle pattern; however, the RSI (14-period) is in the overbought zone.

International Business Machines Corp. (NYSE: IBM) has rallied 22.46 percent from the low of USD 117.36 made on 22 January 2021 to a 52-week high of USD 143.73 tested on 21 April 2021. On Wednesday, the stock prices closed at USD 143.55, up by 3.90%, and was one of the top gainers in the Dow Jones Industrial Average index. The stock outperformed some of its competitors, such as HP INC. (NYSE: HPQ), Intel Corp. (NYSE: INTC) and Microsoft Corp. (NASDAQ: MSFT).

Image Source: © Kaarsten |

IBM on the daily chart

Source: Refinitiv, Thomson Reuters; Analysis: Kalkine Group

On 21 April 2021, the stock has broken out of its rising channel pattern at USD 139.20 level after consolidating for more than seven months in a channel pattern. The price has registered a decisive break out of the channel pattern that suggests a change in the trend from sideways to upward. The price has also broken out of a horizontal trendline resistance level (black color horizontal line in the above chart) at USD 135.81 level.

Furthermore, the price is trading above its 50-period SMA, acting as a crucial support zone around the lower band of the channel pattern. MACD (Moving Average Convergence Divergence) is also showing a positive crossover and trading above the centerline, depicting a positive momentum for the bulls. The price is trading above its Parabolic SAR indicator, acting as a support level for the stock. However, the momentum oscillator RSI (14-period) is trading in an overbought zone at ~73.26 levels, indicating that the price has reached an overbought zone.  

IBM on the weekly chart

Source: Refinitiv, Thomson Reuters; Analysis: Kalkine Group

IBM Stock price has broken out of an ascending triangle pattern at USD 135.80 level on 20 April 2020 and now, the prices are sustaining above the upper band of the triangle pattern. Upon analyzing the chart, it is clear that the prices are now approaching the downward sloping trendline resistance level.

The stock price is well placed above its 50-period SMA, acting as the important support at the lower end. The momentum oscillator RSI (14-period) is trading at ~67 levels, indicating a possibility of further upside movement in the stock towards the resistance zone. The prices are trading above the Parabolic SAR indicator, acting as an immediate support zone for the stock near the lower band of the triangle pattern. The major resistance level for the stock is at USD 150 level.  

Based on the above chart analysis and technical outlook, IBM price seems to be in an uptrend. Currently, the stock prices are approaching the key resistance zone. The chart pattern suggests that there might be more action expected in IBM if the price breaks the important resistance levels in the coming weeks.

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (Kalkine Media, we or us), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK