Tuesday, January 17, 2012
Security Name:
Scomi Marine, SCOMIMR (7045)
Technical Analysis:
After pulling from top to the bottom according historical chart, SCOMIMR now consolidate in low price area with a chart pattern called symmetric triangle. Symmetrical triangles can be end up with up trend (bullish) or downtrend (bearish), depend on its forming area.
A market movement is resting and ready for next future direction. Supply and demand are stable or same and smart money are collecting pullet now. New height is decreasing and new low keep supported nicely, thus forming the narrowing triangle look. Normally, the stable between demand and supply is broken at the end of this pattern as the buyer eat up all market stock like chart above.
With huge volume, the candle stick will break the upper triangle line and the price will push up rapidly. In this case we need to buy before the break but near the bottom line or after MACD golden cross above 0 (yellow circle in chart). Be careful, if the price break though below the bottom triangle line, then the bearish is continue after a pause, we MUST cut lose to reduce further loses. Usually the target price is set above the highest price inside the triangle.
A market movement is resting and ready for next future direction. Supply and demand are stable or same and smart money are collecting pullet now. New height is decreasing and new low keep supported nicely, thus forming the narrowing triangle look. Normally, the stable between demand and supply is broken at the end of this pattern as the buyer eat up all market stock like chart above.
With huge volume, the candle stick will break the upper triangle line and the price will push up rapidly. In this case we need to buy before the break but near the bottom line or after MACD golden cross above 0 (yellow circle in chart). Be careful, if the price break though below the bottom triangle line, then the bearish is continue after a pause, we MUST cut lose to reduce further loses. Usually the target price is set above the highest price inside the triangle.
Strategy:
Buy below @ 0.38
Cut Lose @ 0.33
Target Price @ 0.47
