Bull & Bear: International Business Machines

Shares of International Business Machines IBM are trading lower on the session by 0.60%, at $165.10. With shares recently breeching the 50-day moving average, you have to wonder where they could head next… Bulls: Bulls will note the International Business Machines is in the midst of a 12-month bull trend, where any pull back below the 50-day moving average has been an amazing buy point. The last time that shares dipped below the 50-day, they rallied nearly 14%. Bulls will also note that the 200-day moving average remains upward-sloping and that International Business Machines is currently oversold. Bulls typically cite favorable valuation as well, with shares trading at 11.30x next year's earnings and a PEG ratio of 1.01. A bullish trader could buy the July $160/170 risk reversal for a net credit of $0.19. Bears: Bears will note that International Business Machines has formed a downward-sloping trendline recently, which is now acting as overhead resistance. The 20-day moving average is also downward-sloping, which could mean that traders are no longer accumulating shares. Bears will also note that the 50-day moving average is in danger of tipping lower as well. MACD is general looks quite bearish. A bearish trader could buy the July $160/150 1x2 put spread for a net debit of $0.80. International Business Machines Corporation is an information technology company. It operates under five segments: Global Technology Services, Global Business Services, Software, Systems and Technology, and Global Financing.