The recent selling in this share seems hugely overdone, considering the company's chips are used by Apple and are also to be compatible with the Microsoft Windows 8 operating system. It is now at the bottom of its nine-month range, which acted as great support on the previous two occasions. The last two times that Arm tested the 520p level intraday, it rallied strongly over the next couple of sessions. At these oversold levels a bounce is due and a rally could be worth buying.
City Trades are written by selected external contributors and are based on the interpretation of patterns on a share price chart, rather than on fundamental analysis of the company's business or prospects.