4DS Chart for Long Term Holders, page-451

I thought I'd post two charts this week. The first is my VSA chart that focuses on current market sentiment, as indicated by the price and volume action over the past few weeks. The second is a chart with the Guppy Multiple Moving Averages indicators shown on it. This chart focuses on Trend and Trend Strength as implied by the red (Trader) and blue (Investor) moving average patterns. But first, the VSA chart and what it is telling us.



I have marked on this chart the two days on which there was Director selling of the stock. There's no surprise re what happened after the announcement. I was hoping that the Close level at 14.5c of the recent Absorption Bar would turn into longer term strong support but the Director selling put paid to that. Nice to see that someone took advantage of the speculation driven rise in the SP. Not all that good for us LTHers unfortunately. What is promising is the VSA indicators that have popped up since the SP broke below 14.5c. All those hollow green triangles are VSA "No-Supply" indicators which are all signs of strength. Note that the SP has stopped falling at the 11.5c level which is the Low of the recent Absorption Bar. So the view that there was a general market re-rate for 4DS is still my current view. Below this level, 10c and then 9.1c are the lower support levels.

As mentioned above, the MMA chart attempts to assess current Trend and Trend Strength implied by the two groups of moving averages. The chart is shown below.



Personally I wouldn't consider 4DS to be a stock that could or would exhibit long term trending attributes. But the above chart does show some good patterns that a LTHer would be interested in. The Investor (blue) MMAs are well separated and moving higher showing strong trend strength. The Trader (red) MMAs are above the blue MMAs and have bounced up on each price surge. The bold black stepped line shown on the chart is the Guppy Trend Volatility indicator. It is the trailing stop that an Investor would use to manage their trades. Its current level is 10c. The lighter black stepped line is the Trader's Trailing Stop, assuming they are using a 2*ATR() setting for the stop distance. It is currently at the 11.5c level. So both Investors and Traders should be feeling quite comfortable with the current price action. No need to panic yet, as long as the SP stays above 11.5c.

I said I would only post two charts but then I though that some may be interested in viewing my 4DS WaveTrend Momentum chart. WaveTrend is my favorite momentum indicator. The chart is shown below.



The WaveTrend indicator is in the panel directly below the price chart. Just by the way, the blue and orange dotted lines on the price chart are the 50SMA and 200SMA respectively. Notice that the 50SMA crossed above the 200SMA back in mid September this year. This is what is commonly referred to as a "Golden Cross" and a flashing light and loud alarm should have been ringing in the offices of the Funds that invest in speculative stocks like 4DS. Notice that the WaveTrend indicator became overbought on the recent price peak and has started to fall form those OB levels. Also note that since the Golden Cross the indicator has stayed well above the zero level indicating strong up momentum. What we should be watching for now is the indicator turning flat and then back up again and staying above the zero level. Time will tell whether or not the 11.5c level is the bottom of the current correction and hence an optimum buy level.

Here's hoping that the next piece of platform (or whatever) testing results news drives the SP higher again on re-invigorated speculation. Our favorite Director may then be able to take more profits and add a Granny Flat to his new property.

Good luck everyone - All IMO of course.