Thursday, October 1, 2015

DDD 3D Systems Weekly Chart Downward-Sloping Channel Oversold Falling Wedge Positive Divergence Price Extended to Downside

The 3-D printing companies are taken out behind the wood shed in early 2014 and are beaten ever since. The purple downward-sloping channel is in play for two years. 3-D printing has such strong promise but many investors that jumped on board grew impatient and moved on to other stocks. The DDD weekly chart above and daily chart displays positive divergence across all indicators (green lines) indicating a bounce on tap. The RSI and stochastics are oversold and the green falling wedge pattern is in play two more bullish indications.

The brown dots show price extended below the moving average ribbon so a mean reversion higher in price is needed  another bullish hint. Keystone bot DDD today opening a new long position. 3D Systems is a knife-catch and speculative play, only for those willing to potentially lose their money, and the bottom rail of the channel remains in play. The black circle shows the death cross. SSYS is the darling in the 3D space and viewed as best of breed. XONE and VJET are other players. So all four are worth considering after performing due diligence.

There is caution required since the monthly charts hints that more lows are on the way after the stocks recover in the shorter term weekly basis say during October. Therefore, the intent of the trade is to see a bounce over the coming weeks but probably exit the play in October or November. The VJET weekly chart is concerning since the RSI slips to a new low so that play should be avoided. If the 3D space bounces, however, VJET will likely float higher in the short term as well.

XONE has more of a sideways vibe but appears very steady going forward. Rating the four plays, DDD seems the most attractive although SSYS is right there as well, followed by XONE then VJET. A few days or week or so may be needed before the bounce occurs but those will likely be further add opportunities if price does leak lower. The 3-D printers will be interesting to watch from now into the end of the year and the expectation would be for the companies to move sideways and sideways higher into 2016. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

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