Another failed breakout like it did in October, though the magnitude of selloff is markedly lower. As such, price is still trending lower short term but we believe the longer term trend is still up. Price is still above trendline (chart 2) and weekly moving average still points up (chart 3).
Price may revert to up as: 1) 30 RSI is most oversold since Dec (chart 1); 2) Price is still trading above ‘healthy’ retracement level of 61.8%, or 23200, coincidently the double bottom neck in late Dec (chart 1) 3)Positive sentiment in the past 2 weeks and 4) Reaching support levels in stochastics and the uptrend (chart 2).
If so, price should arrest its fall and an eventual close above moving average (chart 1) should confirm the return of buying strength. Preferably, price closing above 24000 and 30 min RSI goes back above 60.
Otherwise, selling should continue and a close below today’s low and especially below 23200 will keep the short term trend down. Further support is expected at 22800 but expect increased selling pressure on successive close below Dec low of 22300.
View the complete report here http://www.osk188.com/Dindex.jsp.
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