Even before AOL announced its purchase of The Huffington Post, the stock already seemed destined to retest the major support area that buyers had established since the firm went public for a second time. For those who believe that, despite the $315 million price paid for the “new media” Huffington Post, this is a strategically sound long-term play for an aging brand like AOL, then this area below $20 is crucial for establishing a major double bottom.
Another interesting aspect about the weekly chart below is that AOL was breaking down last week, prior to the announcement of the deal. To be sure, some large holders could have easily had that information and acted on it. However, even for idealists who presuppose no one acted on inside information, the chart goes to show that news flow can often speed up and exacerbate a technical trend in the prevailing direction.
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not to mention that it’s relative strength is horrible. It could catch support, but I would think it’s more likely to bounce a bit and then drop more ugly.
Fugly. Who on earth would want to own that POS?