I write this because Trade Signum Stock Screener still not update yet on 7.21 pm.. So, I try to fill in the time with a simple example. Now, let learn something today on how to avoid from selecting bearish counters. If u newbie, this is a must to know in order for not to make mistake. If u the expert, pls ignore it. My sample today is DRBHCOM. My fren asked me at what price he can enter. Then i said u look into 20ma, if price very closed, that is the point to watch. Later, he said 20ma somewhere at 2.80. Without look at the chart, i said maybe 1-2 days u he can enter. So, i think i make mistake, now i write it in my blog. Let see the chart....
Chart Orientation
Price drop now for the last 3 days. Remember, all open gap will be fill sooner or later. U see 4 gaps below. Gap will act as a support and will be fill when price goes down. The first gap on top is a weak support. A small gap (1 sen) can't hold high volume of selling. Then the next gap is the number 2 from top. 4 sen gap at 2.51-2.55 have the ability to be a strong support. Why? Because another support ie 20ma sit at the same level with 4 sen gap. With all good news for DRBHCOM, owner of POS Malaysia, PUSPAKOM, PROTON and a Proton Inspira as CEO (ha ha ha), I think this support will hold. Don't buy until u see the white candlestick.
Indicators
From top, 1) acc/dist pointing downward
2) momentum also drop
3) stochastic above 80% and pointing downward
4) MACD Histogram still red.
All 4 indicators show bearish oscillators. No point to enter now.
My View
U need only one second to know that this is the counter u should avoid for now. For longer term, still good. Question is "WHY U NEED TO CATCH THE FALLING KNIFE?".
Happy Trading!!!
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