Unisys: Long-term Sell opportunity.

8 de fev. de 2020

UIS made a massive +60% weekly rise after it agreed to sell its federal government contracting division to SAIC for $1.2 billion. The result technically, was an extremely overbought 1D chart (RSI = 80.509, MACD = 0.480, ADX = 39.766) with the price approaching the 21.00 Resistance (Since September 2018).

There is an interesting technical pattern when the RSI hits its 81.500 - 83.000 Resistance Zone after the formation of a Golden Cross. The price of the stock makes a top, a few days after the RSI hits that Resistance level. What follows after is a strong and lengthy decline (around 1 year) towards the 6.45 - 6.70 Support Zone.

This pattern appears to be cyclical and has been in effect since 2016. Since Unisys' earnings are end of February (2020) we may be seeing that top then near the 21.00 Resistance. Our advice to sell then and take profit on any level you feel comfortable towards the 6.70 Support.




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