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Looking at FedEx and Intel for Market Tells

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There are times when critical clues are provided about the general market but are predicated upon individual companies.

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MINYANVILLE ORIGINAL Although I remain solidly of bullish bent, as a technician I have to always keep my ear to the ground examining the chart action that speaks to my expectations as well as against them. Ever since I began writing for Minyanville in late May I have attempted to demonstrate how the markets typically leave clues on the charts with respect to what they wish to do next and that, if you pay attention, you have an odds-on advantage over anyone who doesn't.

Many times those clues show up in general markets' response to good or bad market-affecting news. There are times, however, when critical clues are provided about the general market but are predicated upon individual companies -- big and important companies. In the past week there have been two of these events and both are telling us something.

Last Wednesday, FedEx (FDX) shocked Wall Street by lowering estimates. The immediate reaction was to sell off the transportation sector and the stock. The resulting FedEx daily chart wasn't a pretty picture, but if you pulled the chart back to the intermediate term time frame, you are hard pressed to even identify the event on that time frame. In fact, an objective measure of the selling pressure shows that the demand at the lower price levels was comparatively greater than the supply, which is evidenced by the anchor bars that were tested. In this case, the market provided the test and the bulls won -- hands down.

fedex-chart

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