Leading networking and communications hardware company, Cisco Systems inc (CSCO), has been declining sharply lower recently. On August 12th, 2020, Cisco reported earnings that failed to impress Wall Street investors. The stock was trading as high as $48.45 a share on August 11, 2020. Since that high pivot, CSCO stock now trades around $42.00 a share. The stock is now trading below its important 50 and 200-day moving averages. This puts the stock in a weak technical position on the charts and it will often signal a lower share price in the near term.
Traders and investors should now watch the $38.00 area for solid chart support. This level is where the stock was defended in early April 2020 before surging higher. There is also an important retrace level around the $38.00 area making this an even more important trade level. I will be looking for a long side trade in CSCO when the stock gets into the $38.00 area.
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