America Movil, S.A.B. de C.V (AMX) has been trading sideways in a rectangle (basing) pattern since November. A trigger could occur in either direction via a daily close, either above resistance or below support. The minimum expected price objective is generated by measuring the height of the pattern and expanding by that same distance from the trigger point. There are potential early warning signals of a downside trigger from the On-Balance Volume (OBV) indicator and comparative relative strength of AMX versus SPY.
Chart 1: Highlights the rectangle pattern and displays the recent down move in the OBV. Trigger: Long: daily close above resistance at $59.65, Short: daily close below support at $55.65. Target: Long: $63.65, Short: $51.65. Protective Stops: Confirmed move back through the trigger point.
Photo: Click on chart to enlarge
Chart 2: Displays the recent down move of the comparative relative strength of AMX versus SPY. This break down displays the underlying weakness of AMX and could be an early warning to a downside trigger of the rectangle pattern.
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Disclaimer: The information contained herein is not guaranteed. This is not a solicitation of any order to buy or sell. This material is based upon information that I consider to be reliable, but I do not guarantee its completeness or accuracy. Assumptions, opinions and recommendations contained herein are subject to change without notice, and I am not obligated to update the information contained herein. I have positions in AMX and SPY. This communication, including any attachments, is for the exclusive use of the intended recipient(s) and/or the intended recipient’s designees. Any use, retention or dissemination by a person other than the intended recipient is strictly prohibited. If you are not the intended recipient or designee, please notify the sender immediately by return e-mail and delete/destroy all copies of this communication.