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America Movil SAB de CV (ADR) (NYSE:AMX) – Rangebound Within $18-$23

Boston, MA 10/17/2013 (wallstreetpr) – America Movil SAB de CV (ADR) (NYSE:AMX) (Closed: $21.75, Up: 4.22%) remained absolutely flat till the midsession on Wednesday, when the news about the company withdrawing its bid for Koninklijke KPN N.V. (ADR) (OTCMKTS:KKPNY) came. The stock promptly jumped but faced selling pressure at the higher levels to close a bit lower finally. On the other hand, KKPNY lost about 9% in the OTC markets. The volume for AMX exploded at 21 million against an average volume of 7 million only. The price action produced a big green candle with a long tail on the upper side showing the profit booking.

The stock has been in a huge bear market since the latter part of 2007. In the period of 2003 – 2007, the stock had a golden run as it reached an amazing high of $34.57 from the 2002 bottom of $1.92, very much in an uninterrupted fashion. The bear market of 2008 turned out to be very severe though, bringing a crash in the stock where it lost about 70% of its value in a matter of months. In 2009, it made a Double Bottom in the zone around $11.60 and bounced back to $29.81 by early 2011, exactly 80% retracement level of the entire fall. The bear market that started from that 2011 top has not been finished yet but it is taking support from $18.26 – $18.39, exactly the 61.8% retracement level of the rally from the 2009 bottom to the 2011 top. This zone also coincides with the trendline connecting the 2003 bottom & 2009 bottom, making it a very strong support zone. If this area can manage to remain intact, then the price can rally and most probably, make a huge Triangle.

But any rally would be confirmed only on a move above $22.70, the historical supply zone and $23.20, the channel resistance. Aggressive investors could accumulate the stock on dips with a stop loss below $17.

Published by Alan Masterson

Alan has over 25 years of trading experience in the U.S. equity markets. He began his career in finance working on a program trading desk specializing in over-the-counter stocks. His career progressed from that point to his current position as senior trader on an institutional trading desk. In the evenings, Alan teaches economics at a local community college. He has contributed articles to various publications over the last six years, including feature articles for an economics magazine and various financial blogs. You may contact Alan via his email ([email protected]) or his Google+ page (https://plus.google.com/103338576216002376250).



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