Shares of Abercrombie and Fitch (ANF) have been sliding since March, when price just missed 33.00 and retreated all the way to 14.00 by November. With the stock holding above 14.00 in November, it looks like a double bottom is forming.
ANF 4H Chart 11/25
(click to enlarge)
- In the 4H chart, we can see that price came down near 14.00 twice in November.
- The fact that 14.00 is held twice is a sign that the downtrend might be over for 2016.
- Note that the "neckline" of the double bottom is around 17.30-17.35.
- If price comes back up to this resistance pivot, ANF would also be challenged by a falling resistance going back to April.
- A break above 17.35 is therefore a critical signal for the bullish reversal scenario.
- Also, note that the RSI broke above 70 (almost to 80), and held above 40 on the subsequent dip. This shows that momentum could be shifting upwards.
- I think a break above 17.35 first opens up the 20.00 psychological level, but also the 23-24 area, which involves a previous resistance pivot as well as a support/resistance pivot area.
Has ANF found a bottom for 2016? Will it push above 17.35.