InterDigital Inc (IDCC)

[plumear]

frobinso, the over all market, especially the DOW is at a tipping point right now technically, and there are a lot of traders/investors that are watching very closely, with many making there bets now. If you look at a little longer term chart, you will see the DOW,( the NAZ chart follows fairly closely )is falling again below a long term support line.

Twice this year the DOW has pulled back above this point but now the support line is coinciding with a long term uptrend line that goes back about 4 years. In the chart I have linked below, you will also see there was a little bit longer 5 yr trend line that, when it was broken, it was just after it had completed a head and shoulders formation. Normally, a H&S formation calls for a drop of an amount that is about the same as the distance between the neck line and the top of the head. That is exactly what it did and then the market came back up and rode the bottom of the 5 year trend line until it reversed again when it met resistance from the downtrend line beginning to form from the top of the H&S to the top of the right shoulder. It is now where it has just fallen below that support line and has met with the 4 yr up trend line. IF IT FAILS TO HOLD, IT WILL COMPLETE ANOTHER, LARGER H&S FORMATION! If it does, the drop could be dramatically more than the last one! If one looks at the other indicators such as RSI and Money Flow, they are confirming the price chart. Volume is heavy on the selling periods and lighter on the buying. MACD has just crossed to the negative side. If the DOW price direction changes and holds up to rally from this point, like it has done previously, it will be good. I will post another 10 year chart in my nesxt post to show where the market could go if it survives this crucial point. It needs to hold though. The ten year chart gives a more positive view somewhat since it can be seen that we are also at another support line that roughly coincides with the weekly 200 MA.

Five year chart:

http://stockcharts.com/h-sc/ui?s=$INDU&p=W&yr=5&mn=6&dy=0&id=p54004454666&a=114447419&listNum=1