The kickback rally – your last chance to get out

yamada.jpgLouise Yamada, Managing Director of Louise Yamada Technical Advisors, talks about Avon’s historical price chart  to demonstrate how technical analysis can allow you to get out of a stock before it drops like a rock, as the makeup company did in the ’70s.
“This stock went from 200 to 19. That is a decline we do not like to have our clients experience.”
She points to Microsoft and Intel as stocks that could be poised for a fall, and says technical support for Google is at $350. “If it breaches $350, bye bye.” She said that IBM was another one she was worried about.
Yamada, who spoke at the Reuters Investment Outlook Summit on Tuesday, ran the technical analysis division at Citigroup before it was shut down in February of last year. Check out this hand-drawn stock chart:
(Click on image to view full resolution version of chart)