We know that share price never go up or down in straight line. The pertinent question is: How to distinguish reversals from corrections and subsequently making decision to buy, hold or sell?
Characteristic of Correction:
Characteristic of Reversals:
Hibiscus share price closed up by 3.4% at RM0.46 on 15/9/2017. The day high was at RM0.47 which is above the trendline but unfortunately the close at RM0.46 is exactly at the trendline. Strictly from the technical perspective, the treadline breakout required a close ABOVE the trendline to be valid. In a layman terms, the trendline is NOT broken, yet. However, the underlying bullish tone is pretty much obvious in the chart.
I consider the trendline as the line in the sand. Below, the consolidation in the form of a narrowing wedge will continue (as long as it stays within the wedge). Above, this breakout will be a reversal of the nearly 6 month long downtrend/consolidation. Supporting this hypothesis is two important news that will fundamentally alter the stock outlook.
Above there, the immediate resistance is at RM 0.475 (9/8 High), RM 0.51 (30/5 High) and then a much stronger resistance at 0.56 (6/2 High). Above RM 0.60 is clear blue sky with strong resistance only seen around RM 0.90. Be patient, the breakout is tantalizingly close but not yet!! Those with positions may hold tight and only choose to top up after the breakout is confirmed. Those without may choose to enter only upon breakout with tight stop just under 200 SMA or the lower wedge trendline.
Disclaimer: This is for educational purpose only, and is not a recommendation to buy or sell.
Created by Lau333 | May 16, 2018
Created by Lau333 | Nov 22, 2017
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Created by Lau333 | Sep 14, 2017
Thank you Connie for the kind comment. I'm humbled. Hibiscus breaks all the resistant points in this write up and rocket all the way up into clear blue sky within one day.
My latest post is up. Do take at look at "Shell Trilogy: The Great Sale".
Newbie here.sold too early.shld i chase n buy back tmrw??
chase jgn tak chase
lau, your analysis is as tantalizing as the consolidation breakout :) patience pays off !! thanks so much for the posting .. hope to read more of your blogs !