Adobe Inc., one of the largest software companies in the world has long been regarded as a favorite for growth investors. The current technical outlook however should be a warning for holders of this stock. The closing price of Adobe on 22nd of March 2024 was $504.21 which is well below the 200 day moving average of 551.78.
The $497 level is significant as it represents the Fibonacci 38.2% retracement level based on the 275.20 to 634.76 range traded since February 2022. Further price depreciation below this level would put focus on $454 (Fibonacci 50% retracement) and thereafter $412 (Fibonacci 61.8% retracement). Bearish divergence seen in the 14 day relative strength index suggests that more downside is on the cards and could well lead to a death cross formation when the 50 day moving average (578.12) crosses below the 200 day moving average (551.78).
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