Shares of Cisco are rebounding today after reaching major support during Monday’s sell off. At yesterday’s low CSCO had fallen 12% from its July 2019 highs. This steep pullback has driven the stock down to the $51.50 area. A low risk entry opportunity could be developing for patient Cisco bulls.
The $51.50 to $51.00 area includes CSCO’s May and June lows as well as the 1/3 retracement level of the 2019 range. Also in this area is the upward sloping 200 day moving average. Last August the 200D held an important low. The 200D remained in control through the rest of 2018 until giving way during the December flush.
We have added to CSCO positions today. A close below $50.00 would be a clear warning sign. Earnings for Cisco are due August 14(PM). Following CSCO’s last earnings report(May 15th) the stock surged over 6.6%, its best gain since February of 2016.