And now let’s move to today’s stock of the day and take a look at Dell. On the daily chart, Dell has developed a technically dangerous structure in the form of a head and shoulders formation, clearly visible and marked on the chart. This is a classic bearish reversal pattern and typically appears when upside momentum starts to fade.
The neckline of this formation has already been broken, but only briefly. Price failed to accelerate lower and has since moved back up to the neckline area. This retest tells us that the battle between buyers and sellers is still ongoing and that the market has not yet fully accepted lower prices.
From a price action perspective, the structure is already leaning bearish. Dell has started to print lower highs and lower lows, which confirms weakening demand and supports the reversal narrative. However, the fact that price is currently hovering around the neckline means that confirmation is still missing and the setup is not yet complete.
In terms of scenarios, a bullish outcome is still possible. A strong recovery followed by a daily close above the highs from the previous week would invalidate the head and shoulders structure. That would turn the recent breakdown into a false breakout and generate a signal to buy, suggesting that buyers have regained control.
On the bearish side, the signal would be confirmed if price closes near the lows of the recent range, specifically with a daily close below Friday’s lows. Such a move would confirm that the neckline is now acting as resistance and that sellers are winning the battle. In that case, the head and shoulders pattern would be fully activated, opening the door for a deeper decline.
For now, Dell remains at a technical crossroads. The next few daily closes will be crucial in determining whether this develops into a confirmed bearish reversal or a failed breakdown that traps sellers.