march 11 ccc charts

Hi All,

Well what a few weeks it has been. There has been an awful lot of selling, but Friday's trading gave some promising signs that CCC could be close to the bottom. I'm not quite yet going to call a bottom on this retrace, but there are certainly some tantilising technical things to look for over the coming few weeks :)

Here is the weekly candle chart, and what has really caught my eye is how remarkably similar the trading so far this year has been to the first 3-4 months of 2010. There is a distinctive falling wedge pattern developing, and a close above the upper line is significantly bullish. It might take two-three more weeks to be confirmed, but a breakout of this wedge would have CCC looking very sound on a technical level. As I said, it might take another few weeks to confirm it because the indicators still have a bit to come off, but I will be making it well and truly clear on here when we get that signal, because it is an unmistakeable signal to buy, buy, buy. It is promising that the stock managed to pull itself back into the weekly channel (which incidently has a slightly different gradient to the daily chart), so perhaps that will be the support to keep the stock above 6cents going into the next week.





Now for a look at the daily chart, and while we are waiting for that pattern on the weekly chart to play out, let's have a look at the stock on a much more detailed level.





Below are the weekly indicators and they suggest we might have to wait a little bit longer for the weakness in the stock to subside. They could turn up next week, but generally indicators such as the stochastics like to come down to the 20mark and then flick up from there. Having said that, the large drop in the stochastics, MACD and money flow is reflective of the stock getting all the dirt washed out of it (i.e. lots of short term weak hands bailing). By the way, check out the volume over the past three weeks. 302M, 298M, 298M. Very similar numbers. Coincidence, or something more interesting?





Same old story with the daily indicators as I've been telling for about the past month. Nothing new to add here apart from some hints at what to look out for over the coming two weeks. In my opinion, the real indicator to watch is the MACD as in the past it has given leading signals of breaks to the upside as it moves back up towards the zero line. There is still a chance for that volume spike in late March if the pattern repeats that we have discussed in the past. Perhaps that will coincide with a breakout of the falling wedge pattern? Interesting, maybe it's all coming together for CCC sooner than we may anticipate.





To finish off tonight, I'll leave you with a lingering thought. I remember just a few months ago SSN was trading at 5.5cents and about half a year ago SDL was trading at 15cents. Both of these stocks I held at the time, and both of them I knew they were worth far more than what the market were willing to pay at the time. Here we are at 6cents with CCC and I can't help but feel the same way about this stock. I don't reckon we will soar 300%+ in a matter of a month like the other two stocks, but I do believe we are on the verge of another move upwards, and this time we will be going to new highs in my opinion. Some may doubt the company, and some may want to pull excuses out of the air for the recent retrace. The truth is, sometimes stocks go through an 'unloved' period with the market. Provided the global markets don't fall off a cliff, I reckon CCC is going to be putting a few smiles on the faces of holders in a matter of a few weeks. There is a fairly bullish pattern developing, and it's just a matter of time before the stock breaks out of this downtrend.

For those who wants to read more about the falling wedge pattern, have a read of the following pages. They are external links outside of the HotCopper website.

1. StockCharts Falling Wedge (Reversal)
2. Wedge Charts
2. BareSearch
4. Continuation Wedge

Have a good weekend all.

Regards, 5hareholder.