Cisco switched to bullish mode

CSCO - Cisco Systems, Inc. – Shares of the leading supplier of networking equipment and network management for the internet switched to bullish mode after breaking key resistance level at $18.00. The “High Pole” pattern generated in November 07 right after the peak at $34.20 developed into a piercing “Long Tail Down” breaking the bullish support line at $30.50 and formally reversing the outlook from bullish to bearish. The turnaround movement confirmed by the double bottom breakout at $30.00 projected also a downside target at $16.20 which at that time seemed unrealistic but 16 months later became so real. The first leg of downtrend reached $21.80 in February 08 where prices gained back some ground pulling back to $27.70 before the downtrend resumed finding lately another support area at $20.60. The new reaction bounced off the $25.20 resistance level although a brief break out of the main trend line at $25.00 created a vain expectation. March 09 final sell off to $13.70 turned out to be a “Low Pole” pattern recovering swiftly from a washed out situation with a sharp up thrust to $16.90 which also projected an upside target at $23.30. The latest trading sessions developed a significant breakout of a multiple top pattern at $18.00 followed by penetration of main bearish resistance line at $18.30 which reversed the trend to bullish. Right after the breaking prices pulled back finding support close the intermediate support line at 16.60 and are presently resuming the uptrend. The Relative Strength Vs the market is negative in the short term but still detaining a positive outlook for the long shot. The technical perspective suggests to go long opening new positions at the double top breakout at $18.70 with initial target in the range of $23.30/$23.60. On the downside lighten progressively at the double bottom breakout at $16.50 and at penetration of the intermediate trend line respectively. Close all positions at penetration of the main bullish resistance line with possible contraction down to $12.60.