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The chart of Equinix Inc (EQIX) has triggered a short-term downtrend after breaking the Linear Regression forecast indicator. In addition, the Rainbow oscillator has turned from positive to negative. The price had also broken the upper band of the MA Env indicator in early July, an indicator that the price has reached an “overbought” scenario. Since then, the price has not been able to break out convincingly above its high of 829. A few days ago, it made a couple of false breaks above that level, but it was not sustainable. This suggests that a bearish scenario has been triggered.
The bearish call was supported by 3 indicators, namely Random Walk Index, Ehler Fisher Transform and Elder Ray. All 3 indicators triggered a “dead cross” on the same day when price broke below the Linear Regression forecast indicator. In technical analysis, the “dead cross” is a “deadly” sign, meaning that price is likely to fall further.
Historically, this has proven true for all 3 indicators on this chart. This is especially bearish when not 1, but 3 indicators had such a signal at the same time.
However, the long uptrend on the chart remains intact. This means that price cannot fall too much before the bulls can take control again, at least for the next 2 weeks. So for now, it is reasonable to assume that price could retrace 61% from its recent high to reach the support level around $800.54.
Traders might consider shorting the stock at current levels for a possible $20 profit.
22 July 2021
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