International Business Machines Corp (IBM) is one of the leading technology stocks in today's market. It is also a leading component of the Dow Jones Industrial Average (DJIA). On January 23, the stock soared higher into the $205 level on reported earnings. Since then, the stock has been consolidating in a bullish manner, though that consolidation pattern is now failing. Sometimes the best stock moves come from failed moves, which seems to be what's happening with IBM.
The Play
Today, the stock is trading lower by $2.02 to $199.02 a share. Short-term traders should watch for intra-day support around the $198.25 level. The daily chart support level should be around the $193.00 area. A decline in IBM will have a negative effect on the DJIA, which is a price-cap-weighted index. A few other stocks that will be affected negatively by an IBM decline include Hewlett-Packard Company (HPQ), Oracle Corporation (ORCL), CA Inc. (CA) and BMC Software Inc (BMC).