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Charting a slippery slope

Credit Suisse shareholders have been wondering what is going on for a few years now as the share price slips, slips and slips again. The share is hitting all-time lows now, with news flow about banks in general, and CSGN in particular, not really helping to draw in buyers. The direction of travel is clearly negative, but it is always good to look at charts and try and figure out what is going on.

The chart below is the long-term monthly semi-log chart. This one says ‘wake me up when we get above CHF 5.85' (lower former support blue line, now resistance).

The chart below is the weekly chart on an arithmetic scale. The share has been hugging the 13-week moving average lower, and the purple line (CHF 4.50 area) shows the 50-week moving average that will be an important indicator to regain if the share price ever pops higher. There is also a horizontal purple line near CHF 4.70 to watch as resistance.

The daily arithmetic scale chart below shows the 60-day moving average and 250-day moving average as potential resistance areas. The horizontal orange line near CHF 2.65 is key for short term recovery plays. The push below CHF 2.00 and volatility halt today is important. A big shareholder has already said they won’t be putting more money in as the 10% ownership limit is a worry. What will Switzerland do if it looks like there will only be one big Swiss bank in the future? Is systemic risk building or is this just a bank that has had made many management mistakes being rightly punished by investors? Again, the trend says watch out below, but on the other hand…

Equity markets live on hope, but charts show supply and demand. This chart has seen supply swamp demand again and again over the last few years. This may change, and a gauge of sentiment change will be the ability to make higher highs and higher lows, and break above resistance. Bonne chance!

Keywords: banks, Switzerland, technical analysis

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