HPQ shares enjoyed a small bounce off support at $25/share earlier in the month but looks ready to resume the longer-term slide. The 100 SMA is below the 200 SMA, confirming that the downtrend is likely to carry on.
Price is moving up to test the falling trend line connecting the recent highs, which lines up with the dynamic resistance at the 100 SMA. Stochastic hasn’t quite reached the overbought zone but looks ready to turn down while RSI is already reflecting a buildup in selling pressure.
In that case, HPQ shares could head back to the previous lows or even make new ones. On the flip side, a break past the trend line and the $30/share level might be an early sign of a reversal.
HPQ Shares Outlook
HPQ shares have been under heavy selling pressure ever since the company announced massive layoffs. Earlier this week, the company’s leadership team provided a strategy update and financial outlook during their 2015 Securities Analysts Meeting.
The new Hewlett Packard Enterprise will have more than $50 billion in annual revenue and will be focused on delivering unrivaled integrated technology solutions to a market that has the potential to exceed $1 trillion over the next three years. Hewlett Packard Enterprise will trade under the ticker symbol “HPE”.
“Hewlett Packard Enterprise will be smaller and more focused than HP is today, and we will have a broad and deep portfolio of businesses that will help enterprises transition to the new style of business,” said Whitman. “As a separate company, we are better positioned than ever to meet the evolving needs of our customers around the world.”
However, the company also pointed out that it plans to deliver $2.7 billion in ongoing cost reductions by cutting 25,000 to 30,000 jobs after the company splits from the PC and printer division of HP. Investors are still waiting to see if these changes can turn into better earnings figures.
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