Ariba (ARBA)

Company

"Ariba, Inc. is the leading provider of Spend Management solutions to help companies realize rapid and sustainable bottom line results. Successful companies around the world in every industry use Ariba Spend Management software and services." (company website)

ARBA stock chart

Buy

17-Oct-05. Last week Ariba jumped above the $6.25 level on nice volumes. This looks like an advance off a several-months-long base (see sidebar).

  • Price momentum (PPO) — accelerating sharply in last week
  • Trend (ADX) — strengthening, with buying pressure (+DI) much stronger than selling pressure (-DI)
  • Money flow (CMF) — has switched from negative to strongly positive in past two weeks
  • Relative strength (RSI) — strong
  • Volume — daily volumes increasing after a slow period

Sell

loss Bottom line
15%

17-Jan-06. The Ariba chart is full of mixed signals, so I decided to sell one of my lots to take some profits. On the positive side, money flow (CMF) has improved tremendously, and price momentum (PPO) has picked up after a long decline. But on the negative side, the trend (ADX) continues to weaken and selling pressure (-DI) threatens to cross above buying pressure (+DI) again. Strength (RSI) is weakening and the more-senstive Stochastic RSI is pointing back down.

I'm going to hold onto the remaining lots for the time being to look for a more clear signal. ARBA gapped down to open this morning, but has been tending upward since the open. This could be either the start of a recovery or a last gasp before collapsing further. The next couple of days should tell the tale. Unfortunately, earnings are due out next Monday, so ARBA may just wallow until then.

ARBA 1yr chart
ARBA 1-year chart