The monthly chart.
The sp is still just contained inside the big candle from 7 months ago. So far the volume is about 2/3 that of the previous month. It’s still too early to say if support had been broken. The next two weeks will be interesting. It looks like there are 5 weeks in this month.
The weekly.
This week’s candle has made a potential double bottom. The support at $0.115 has been clearly broken. The new support is currently sitting at $0.105 and the volume is higher than the previous week. Resistance is $0.115 through to $0 .125 & the weekly stochastic has dipped slightly below the oversold line.
Last week I said that the sp was in a congestion area & it would be resolved in the next week or two. Well this wasn’t what I had in mind and because the sp fell below the long term H & S line as well as the $0.115 support it has not been resolved yet. It has made it worse if anything as it now has a couple of extra resistance lines than it did before.
On the plus side, I think that the chart pattern & volume is signalling a potential reversal but that won’t be confirmed until next week.
What I would like to see on the next weeks chart to confirm that thought, would be for a rally back up to & closing above the $0.125 level.
The daily.
My take on the daily price movements, is that early in the week the mm continued the support at $0.12 – 0.125 while preparing for the next shakeout. The one on the 7th failed after finding support on the rising trend line & the solid support at $0.115,
As the volume continued to decrease (Indicating no buyers coming back in) during the early part of the week, they have tried another one which appears to have been successful in lowering the sp & finding more sellers than the last attempt.
I am sceptical though that the selling volume has been by disaffected shareholders or a Fund manager readjusting after PSY being removed from the index.
Any fund manager worth his salt would be on top of these readjustments & would already have made his move well before the deadline of the 18th.
Monday was an up day on very low volume & failed to break up through the down trending line or the resistance at $0.125. (The 3 previous bars from the previous week showed the same failed attempts to rally)
Tuesday showed another failed attempt to break through the resistance with relatively higher volume (almost twice the previous day) & finished down on support and right in the corner of the converging trend lines.
Wed saw the start of the shakeout & the sp dropped thru support of the bottom of the box and clearing the congestion area before closing at $0.11. The volume was significantly higher than the average.
The support on the md screen was still there at the end of the day verifying buyers prepared to snap them up.
All the gaps highlighted on the statistics chart were filled.
Thursday. The buyers at $0.11 were cleaned out & support built up at $0.105 – 0.10. The volume for the day was twice the average & the sp closed back up at $0.11 indicating buyers returning.
Friday. A large seller at $0.11 controlled the buyers all day being in the front of the cue.
The support at $0.105 & $0.10 was solid all day & the bulk of it is still there at this time. The volume was 2x less than the average. The volume traded at $0.105 was 37% of the day’s volume. The other 63% was at $0.11 which suggests that the selling has almost dried up.
The support on the md screen is mostly still there.
At this stage the sp is currently under the rising trend line and may become resistance for any attempted rally short term.
The appearance of the large seller 1mill at $0.11 Friday was clearly a blocker forcing other sellers to come in below him & is probably the same trader that is supplying the support.
All part of the shakeout game.
This move appears to have nearly run its course.
I know some think that “the market” is sick of waiting & is selling out.
I don’t believe that is true at all. The volumes on these shakeouts should not be considered as selling but the opposite.
If it was selling by the market in general there would be no support at any of the obvious levels or in the md screen.
If it was Top 20 selling there would be notices.
As someone recently said, if there was a problem the company is legally bound to notify the market.
They said in earlier announcements that the batch testing will be done over 12 months & that earlier testing had a very high success rate.
They have recently hired more staff.
It is unfortunate that the company don’t update the market more often but if there is nothing to say then there is no point in rehashing old news.
They do not have to give the market a running commentary every time someone sneezes.
These are just my opinions of course & I will keep saying them all the way to the bottom if necessary lol.
Hang in there, no news is good news.
