IBM: A Technical Look at the Stock, Post-Earnings

International Business Machines Corp. (IBM) said late Tuesday second-quarter profit rose more than 10% from a year ago, helped by lower administrative costs, even as revenue from the technology giant's key global services and hardware divisions fell.

In the weekly time frame, prices are close to the important support of $72.50 with the stochastic oversold and a negative MACD. MACD is printing a positive divergence, however (click to enlarge):

In the daily time frame, the indicators print a negative condition for the stock. However, yesterday's reaction to the news, with a long white candle printed could represent a support in the short term for a rebound toward $76 level. I would not open long positions, given the negative general conditions. Even for a short term trade I would wait some type of confirmation pattern (click to enlarge):

Related: International Business Machines Corp. Q2 2006 Earnings Conference Call Transcript (IBM)