Tuesday, January 09, 2007

Longcheer analysis

Longcheer analysis

I pretty much said it in the charts already.

Time to weigh the evidence:
1. It seems like price did not rebound off trendline today, so a possible exhaustion gap is in the making. Which is one of the scenario that I said might happen yesterday. If it's an exhaustion gap, then I think price will go down further, reverse, then cheong past the trendline and carry on the uptrend from there. Looks like more downside to go, but should be a weak one.

2. MACD histogram shows more downside. I have not seen a histogram with just one histogram below the 0 line and go upwards from there. SO, I think should go down, hopefully a little tmr, finish the downtrend next 3 days (min) and go north of 0 line from there.

3. Hard to say what momentum will do. Might rebound off momentum MA line, or might go below more then rebound. Each way is equally possible, so can't tell what might happen tmr from this indicator. A good sign is that the blue line is confirming its min. point and u-turning. A bullish sign that a reversal is about to come soon.

4. Stochastics - based on history, longcheer's stochastics seldom go below 20% line. So tmr, %K most likely will not breach the 20% line. What this translate is that a little price drop might be seen, if not, U turn immediately tmr. 2nd scenario not so likely because all the lines don't show signs of reaching min. yet. What I think is that %K line will go slightly below, show a convincing turn from its downtrend and pull the %D lines up from there. Might need a few days to see this happening.

5. RSI not clear yet. What is clear is that RSI is going flat. At least its not going downtrend already because it had completed the "higher lows" of the trough and peak theory.

Conclusion: Longcheer is about to reverse its downtrend, should expect it to happen in next 4 trading sessions (to be conservative), baring any unforeseen circumstances. Most likely tmr will see a weak drop because most of the indicators are showing signs of that. If not, it will cheong and breach the trendline, probably hitting a high of 1.34 in 4 market days (not likely).

A very good time to start accumulating in small amounts now to anticipate the uptrend which can happen anytime soon. For me, I'm stuck in some warrants, sigh...

Dow positive as of now, hope and hope and hope it'll close positive. Then tmr will have less reasons for hsi to plunge. Good luck to me!