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Cisco (CSCO) - failed topping suggests bullish continuation; 34 in sight

Shares of Cisco (CSCO) has been consolidating since July and almost put in a price top. However, it looks like the market did not care for further bearish correction, and looks ready for a bullish continuation scenario.

CSCO 4H Chart 8/24

(click to enlarge)

Bullish market:
- First, we should acknowledge the previaling uptrend in 2016.
- Price has been choppy in the past few months, but still maintained a bullish pattern (higher highs and higher lows.)

Earnings prevented a price top:
- Price action was "topping" as it broke below a common support around 30.37 last week. 
- However earnings came in better than expected. The EPS in Q4 was $0.63, which beat forecasts of $0.60
- The fact that price has since rallied back above the "central pivot" area of the price top - around 30.80 - suggests that CSCO is in a bullish continuation mode .


CSCO Weekly Chart

(click to enlarge)

2008-highs:
- A bullish continuation scenario essentially has CSCO back towards the 2008-highs around 33.50-34.
-  From the weekly chart, this bullish scenario is in-line with the previaling uptrend since CSCO bounced off the key support around 14.00 in 2011.