YOW (ASX) Basic technical analysis of YOW

Originally posted by P261F ↑

Hey guys,
I was wondering if any of you guys had a technical opinion as to the recent price action of the stock. From what I can glean from recent threads a lot of contributors on here are hold and wait investors with a fundamental bias. I have been reading a lot about people calling for ASIC to investigate 'manipulation' of the price action, because drops often occur in the last minutes of trade. Like on a lot of other small cap growth stock threads there seems to be a whole bunch of people who just cant comprehend why their beloved stock hasn't pentupled since they bought in. DYOR but here is my basic technical explanation as to the recent movements.

There is no denying that YOW has been downtrending overall since August, if you look at the way the price reacts in the days/weeks following any ann it is clear that there is an elephant trying to get out of the bathtub (so to speak). Any rises are quickly sold down. So whom ever it is that has been exiting a large position in the past few months needs to finish before we will see any more sustainable rises.

In terms of Stochastic's YOW is registering as oversold which may appear as good news for long position holders, however just because a stock is oversold does not mean that it is undervalued, or that significant a market correction will soon occur to raise the price back to a proper range.

Volume of sales remains relatively low, historically speaking we need a volume of about 1.5 million before positive price movements have occurred, IMO i can only see this occurring with another ANN regarding sales or a contract for supply.

Leading up to the end of October the Bollinger bands tightened (a sign of potential future price volatility), and the candlesticks began to hit the lower band (indicating they are oversold), however since the start of November the bands have widened once more, and to add the candlesticks have moved to a more central position.

Finally, yesterdays close at the 0.48 cent mark was a confirmation of a 'bearish harami cross' signal, which in the world of candlesticks is regarded as one of the strongest and most reliable signals that price decline is to follow.

I have faith in the YOW stock and I am looking for an entry to go long with it. However coming from just 0.17 cents in under a year, and with what appears to be an insto's exit after the March/April boom period, the risk is too high even at 0.48 cents. The entire point of what i'm writing here isn't to downplay the value of this company, YOW have a fantastic product and things look good in terms of sales and product popularity ect. What I am trying to say though is that there are larger things at play which are having a price impact, so for those who cry 'manipulation!!!' every time there is a low close just think about the bigger picture. DYOR.

Anyone have any opinions about what i just said? I would love to hear from some other watchers who share my technical bias.

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I respect the work that you do with this regarding technical analysis. My humble opinion is that the smaller the company is the more useless this analysis becomes. Yes trade BHP, RIO or other large caps I believe these technical signals are very valid. But I ask you shown me a technical analysis in the past for a small cap that came true. With YOW and other small boys, one announcement, like an other 1 tier client, or opening up in the UK etc. will get the price to rise. No tech analysis will predict this or guide against it IMO