A Pair of Chemical Shorts

After enjoying a year of solid gains, shares of chemicals name DuPont (DD) are now breaking below an intermediate-term uptrend line. Several other technical conditions and indications, moreover, are reinforcing the potential breakdown scenario.

DuPont (DD) -- Daily Source: StockCharts.com View Chart » View in New Window »

A potential double-top has formed following a December high and another made earlier this week, and Thursday's gap lower has broken a horizontal support line drawn off the November highs and the 50-day moving average. That, in turn, has taken the stock into lower Bollinger Band range. The relative-strength index (RSI) is below its centerline, and the two moving-average convergence-divergence (MACD) histograms -- the orange one representing the weekly indicator and the green the daily indicator -- both reflect bearish crossovers. Chaikin money flow has dropped below its 21-period average and is testing its centerline, reflecting distribution at these levels....188 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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