Being an optimist I don’t really see things being particularly bad just yet, chart wise at least.
Looking at the last few week’s action it appears that until 4 days ago the stock was being accumulated this is still happening but with an orchestrated pushdown made easier by the lack of news.
The daily chart shows the continuation pattern has failed. At least on the daily time frame.
That pattern started on 7 July after reversing off a 12 month low and failed on the 4th Aug when the sp again fell below $0.13.
This failure happened over the last 4 days trading on volume of 1,505,127, hardly a stampede but I guess some will be working themselves into a panic & trying to get others into that same frame of mind.
Don’t take any notice of what they are saying, they have an ulterior motive and that is solely to get your shares and get them cheap.
Nothing fundamental has changed & the sp is not in free fall.
Just because there has been no announcement for the instant gratification type traders & nervous holders is not a reason to sell or panic, rather this is a great time to accumulate yourself.
What is that old saying? Follow the money? Well the money is accumulating not selling.
Look at the inverted chart, what does that look like? Does it look like its hit resistance & about to fall or is it going to gap up thru the resistance?
I can also see the potential for other lovely chart patterns forming from Friday’s close, Cup & saucer, head & shoulders come to mind.
We are now back in the bottom half of box 6.
When this box first formed it had the potential to get down to $0.10. It did not quite get that low & it does not mean it will do it this time either but it might & we should be prepared for it as a place to buy. That is what these boxes are for.
What I think (& hope) I am seeing though now at Fridays close is that we have steadied, found a support at $0.115 and closed higher than that, making a higher low from the July 7th low.
What I hope to see next week is the sp climbing up either the blue or Red rising trend lines. These two lines are tentative atm but fit with my expectations. Time will tell.
The weekly chart shows a different story.
PSY has been in a downtrend since Oct. 2014.
The rebound from $0.105 four weeks ago broke that down trend & appears to be forming the same continuation candle pattern that the daily chart did back then. Being a weekly chart this pattern needs a minimum of 5 weeks to form.
It shows a large candle on the week ending the 17th July with the following 3 weeks still contained inside that candle (Well near enough to still be legitimate I think) and rebounding from the three trend / support lines shown.
The way I draw trend lines may differ from others but the more times a stock rebounds from an established or historical trend or support line the more significant that line becomes particularly once it’s broken. I believe that it was broken the week ended 17th July, others will have a differing view.
Next week’s candle may give us confirmation one way or another.
If the sp closes above or at the top of the range of the big candle its game on, if it falls below then it has to close lower than $0.105 to be still in a downtrend.
Hang in there it will go when its ready.
As I said before these patterns can form over several days or weeks. Obviously the weekly is slower to form but is a more powerful signal
What I see on the weekly atm is the same as what I saw on the daily 4 weeks ago.
I do not see the sp going below the bottom of the box but if it does it does, just follow the patterns & work out were a potential entry point may occur, that is what the point of TA is all about isn’t it?
If it goes back up through the box center then that is a great spot to buy more particularly if you like a punt on one of the above patterns coming to fruition.
Hang in there they will tell us something good eventually.
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