ARM Holdings (ARMH)

Company

"ARM designs the technology that lies at the heart of advanced digital products, from wireless, networking and consumer entertainment solutions to imaging, automotive, security and storage devices. ARM's comprehensive product offering includes 32-bit RISC microprocessors, graphics processors, enabling software, cell libraries, embedded memories, high-speed connectivity products, peripherals and development tools. Combined with comprehensive design services, training, support and maintenance, and the company's broad Partner community, they provide a total system solution that offers a fast, reliable path to market for leading electronics companies." (company website)

arm(3-1)
ARMH 4-month chart
arm(3-1)_1yr
ARMH 1-year chart

Buy

ARMH bottomed at the beginning of the year and has risen sharply since. After peaking at the end of June, ARMH has pulled back to about the one-month average, a level that MarketEdge says is support. The 50-day moving average crossed above the 200-day in May. The 200-day has leveled off and is poised to start rising.

  • Percentage price oscillator (PPO) — back at the signal line
  • Volume — recent high volumes, on both up and down sides; I interpret that as mostly profit taking

I've gotten burned before trying to anticipate the PPO line. I hope it doesn't happen again.

Based on technical analysis, MarketEdge calls ARMH a "strong buy" in a "weak upward trend."

Sell

gain Bottom line
8%

ARM Holdings reported earnings yesterday before the US market opened; although profits for the quarter were down 26%, they confirmed their full-year forecast in line with Expectations. The stock enjoyed a decent rise during the session. Today, however, it was hammered.

So what happened? Maybe somebody converted their earnings, reported in pounds and pence, into dollars and cents? More likely today's sell-off was a result of an analyst downgrade.