EBAY Shares Testing Double Top Neckline – Oct 28, 2014

EBAY Shares Testing Double Top Neckline - Oct 28, 2014

EBAY Shares Testing Double Top Neckline - Oct 28, 2014

EBAY shares may be ready to resume their decline, as price is testing the broken neckline support around $52/share. Recall that EBAY shares sold off sharply after this reversal pattern was seen on its daily time frame.

Price has found support at the $49/share area and showed a quick bounce, with MACD suggesting that further gains are possible. If so, EBAY shares could climb to test the SMA resistance around the $53/share level.

EBAY Shares Forecast

RSI is also suggesting a continuation of buying momentum, as the oscillator made it to middle ground after climbing out of the oversold area. Further gains could take EBAY shares to the previous tops at $57/share.

On the other had, a resumption of selling momentum might lead to a test of the previous lows at the $49/share level or perhaps the formation of new ones, depending on the outlook for the company.

Just recently, news of another scam on Ebay popped up, reviving fears of security threats on its online accounts. Reports show that users might be redirected to various buying sites and a login page that resembles that of Ebay, which then prompts clients to enter account information. This enables the scammers to hack into online accounts and possibly use valuable information for fraudulent activities.

This could weigh on Ebay shares moving forward, as the previous security threat already resulted to considerable losses for its stock price. This could also wind up discouraging e-commerce activity on the site as well, which might lead to lower revenues and profits later on.

Risk sentiment is also against further stock gains for the time being, although other companies such as Apple have been more resilient. The upcoming FOMC interest rate statement could set the tone for market sentiment in the US economy for the rest of the year.

To contact the reporter of the story: Jonathan Millet at john@forexminute.com