APKT Acme Packet Weekly Chart Falling Wedges Oversold Positive Divergence

The weekly chart for APKT shows two falling wedges in place along with oversold stochastics and near oversold RSI (which is a bullish set-up). The red lines show the rising wedge, overbot conditions and negative divergence that caused the smack down starting in May 2011.  APKT has fallen from 85 to 20, 73%, over the last year.  The blue lines show the positive divergence now in place that should bounce price strongly, especially considering that the daily chart is positively diverged across all its indicators as well.

Note that the 20 support level is very strong, consolidation occurred here two years ago, and it serves as a logical launch point. The 18 level cannot be ruled out since Keystone's 80/20 rule says 8's move to 2's, thus, the breach of 22 typically would lead to 18.  Considering the powerful positive divergence in place, however, perhaps price will bounce first then venture lower again to firmly stablilize and create a firm base for the long term from 18-20. It appears the worse is over for APKT. Venture capitalists continue to favor the stock. Keystone is in this one long right now. This information is for educational and entertainment purposes only. Do not invest based on anything you read here. Consult your financial advisor before making any investment decision.