Leading networking and communications hardware company, Cisco Systems Inc (CSCO), has fallen sharply since late December 2021. On December 29th, 2021 the stock traded as high as $64.28 a share. Today, the stock is trading lower by $0.52 to $55.14 a share. This is a sharp decline in the popular networking stock as it came under distribution with the recent broad market decline. The stock is now trading below its 50, 100 and 200-day moving averages. This puts the stock in a weak technical position and further downside is likely in the near term.
Traders should watch for near term support around the $52.00 area. This key support area is where the stock was defended on November 18th, 2021 with heavy volume. This tells me that the stock had institutional sponsorship around this level and will be defended again when it is tested. I will be looking at a long side trade around this important support level.
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