weekendcharting 28 november, page-78

Emanuel, heres some observations on EGO:

On a weekly chart price seems to be trending up in a channel. The 1.5c area seems to have some significant horizontal resistance. Weekly volume has picked up in the last 3 weeks which is interesting and in the right places too.

Acc/Dis has been showing negative divergence since the stock bottomed at 0.004, meaning someone was selling into the rally. This Acc/Dis downtrend line was broken on Nov 10 meaning that theres a good chance the selling had stopped. As what can often happen, price then broke to the upside a couple of days later into what looks like a new little trend with a bit more volaitility. It certainly has a better chance now that price and Acc/Dis are roughly moving together as Acc/Dis tends to eventually drag price down with it if it shows negative divergence. Of note on Friday, Acc/Dis broke its up trend line so she may consolidate for a little while before moving up further.

Stochastics are very much all over the place, but has been in an uptrend recently making a higher low. On Friday the Stochastics broke this uptrend, showing some weakness in the trend and perhaps confirming what Acc/Dis is telling us, that she may need a breather here for a little while.

On the daily chart, I think the 1.6c area that it bounced off on Friday will prove to be a tough nut to crack being horizontal resistance and the top of the ascending channel. Its also got quite a bit of overhead resistance past that. A good entry would be on a pull back to the bottom of the channel IMO, or on a break of the top of the chanell, you could buy a pullback to the top of the channel if the volume is low. Im always suspicious of stocks that break the upper band of an ascending chanel as often they are blow off tops. Its got pretty strong support around the 1c area if the bottom of the channel was to fail.

One more negative to note is that on the daily chart, price broke the bottom of the channel which weakens the channel IMO. It has since obviously jumped back in it, but it definately weakens that bottom trend line as a support.

[URL=http://img686.imageshack.us/i/egoweekly.png/][/URL]

[URL=http://img697.imageshack.us/i/egoaccdis.png/][/URL]

[URL=http://img686.imageshack.us/i/egostoch.png/][/URL]

[URL=http://img12.imageshack.us/i/egoweeklyvolume.png/][/URL]