PHG – Koninklijke Philips Electronics – Shares of the manufacturer of medical systems, consumer electronics, lighting products and semiconductors are challenging key resistance at $20.75 after a powerful up thrust from the $17.50 double bottom. From the July 07 peak at $45.75 prices weakened sharply reaching $35.75 where a Low Pole pattern developed. The movement pulled back to test the previous peak but failed to break through $45.40 evolving into a pattern of lower highs and returning to $35.00 where a narrow sideways movement started. On June 08 the penetration of the main bullish support line at $37.75 changed the overall outlook from bullish to bearish. The first leg of contraction found support at $30.75 where a corrective up move developed pulling back to $36.00 before bouncing off the main bearish resistance line. The downtrend resumed into a pattern of lower highs and lower lows until the final sell off reached $14.75 on November 08. A sideways movement with resistance at $20.75 and base at $14.00 started. On April 09 the penetration of the main bullish support line at $17.00 confirmed by the double top breakout at $17.25 switched the trend to bullish. Prices are still moving sideways and have now reached again key resistance at $20.75 opening for a possible breakthrough. Relative Strength vs the market has turned positive implying an outperformance in the long run. The weight of the evidence is tilting on the buying side although a penetration of the $20.75 resistance is necessary before going long. Hold on until penetration of resistance which will realize at breakout of the multiple top pattern at $21.00. Short term target is set at $22.50 while the medium term objective is at $27.25. On the downside close all longs at penetration of the main bullish support line now crossing at $17.75 with possible contraction down to $15.75.
MMM – 3M Company – The global diversified technology company saw its shares breaking through the multiple top pattern at $61.50 heading toward key resistance at $67.50/$68.00. From September 07 peak at $97.00 prices fell sharply breaking through the main bullish support line at $88.50 switching the trend to bearish. The downtrend rolled out reaching $79.00 where a pullback developed extending to $88.50 and bouncing off the main bearish resistance line. The movement weakened further finding support at $72.50 on January 08 when a up thrust returned back to $81.50. Since then priced started moving sideways with base at $75.50 and resistance at $81.50. On June 08 the multiple bottom breakout at $75.00 triggered a continuation of the downtrend temporarily interrupted by another sideway move with base at $68.00. The Long Tail Down pattern to $50.50 provoked some reaction with the corrective up move to $67.00, a level which worked as support during the previous downtrend. The final sell off reached the lows on March 09 at $41.00 where a Low Pole pattern projected an upside target at $66.50. Prices moved up breaking through the main bearish resistance line at $51.00 changing the course to bullish. The upside move continued hitting resistance at $61.00 before turning down on a profit taking to $57.00. The uptrend resumed recently with a piercing up thrust which breaking through the multiple top pattern at $61.50 cleared the way for further upside move. Relative Strength vs the market is positive in the long run making it a likely outperformer. Stay long and increase at triple top breakout at $67.50 with short term target at $72.00. In the long term the objective is set at $102.00. On the downside lighten at double bottom breakout at $57.50 and close all longs at violation of the main bullish support line now crossing at $56.50 with possible contraction down to $51.00.