The high volume ""Arms Volume"" wash out box yestersy was a great sign for a turning point in the trend. The typical bottom consists of a big box that washes out the last
sellers, ( ie close to 700,000 yesterday) followed by an immediate rally, and then a lighter-volume pullback that tests the old support. Long term down trend line touching highs in Jan 52 cents, April 46.5, July 41.5, Aug 41. Will
intersect at 40 cents so expect this to be a point of resistance, and if it breaks through then could break out to 42/43 but be aware capital raising at 42 cents in Oct 09 means lots of sellers still wanting to get their money
back. How to trade ? Assuming you bought yesterday or hold wait for anticipated spike on Friday 27th OR Monday 30th
with release of report and get out of the stock as close to the intraday high as possible....anticipating 40 cents. However it may break out BEFORE the results announcement...employ the same stategy and don't wait for
the results. Could use a trailing STOP LOSS as well.
If nothing happens by Weds week then dump it. Stop loss - set at 33 cents. Interesting to note the low of 34 cents has been tested a number of times since May.
Intraday 21st May..again 31st May..7th June..broke to 33 cents...but recovered next dayto close at 36.5. 25 June...close 32.5..but again recovered next day to 35.5.
Aug 12th...intraday low 34.5 17th Aug...intraday low 35..today...intraday low 34.5.
There's has been some nice big wash out boxes along the way - what we are hoping for is that the last sellers at 34/35 have been taken out to form the base of an uptrend.
Note on the 13th of Aug it appeared to break out but the volume was weak and it failed. We are looking for + 500,000 volumes for a couple of days in a
row so it can gain momentum. Once it breaks out...watch for the "doji stick" pattern after a few days which signals a reversal in the trend..like on 30th July which can signal the trend has come to an end i.e reversal
Trade 20,000 bought yesterday at 35 cents
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