CSCO Stock Is Setting up to Test Price The first level of support is defined by using a horizontal trend line. This trend line is created by connecting the peaks on the price chart that occurred in 2015 and 2016. This price level served as resistance over that time frame and, in July 2016, this level was finally breached to the upside. When a level of resistance is broken, it becomes a level of support, and it is common for the price to return to test this level from above.
This is the level that coincides with the 200-day moving average, and this would be a difficult level to breach on the first attempt and, as a result, I am expecting a bounce off of this level.
If the market conditions continue to deteriorate further, then the second level of support will probably be put to the test. This level of support is defined by using an uptrend line. This trend line is created by connecting the valleys on the CSCO stock chart.
Economic and political uncertainty is causing bearish headwinds and, at the same time, Cisco stock is setting up a bearish pattern. These factors are reasons to reduce leverage and hedge any risk. A test of support would be within the confines of a bullish trend in CSCO stock and could present an opportunity.Click here for reuse options!