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Technically, what's on the table for now: - Olam has turned down after a gap (created on 16 May (S$1.87-S$1.97)) cover. - A follow through of the bearish candlestick pattern formed in the last trading session. - A TLB (Trend Line Break) suggest to look for the next immediate support level. - And that potentially could be found at the gap created on 18 June (S$1.83-1.87). The level at S$1.83 is also a confluence of a level near its 20-day moving average, which acted as a resistance before its recent sell off could now potentially turned as support. Reference: Take profit - mentioned on 21 June 2012 (Retail Market Monitor, traders corner) Accumulate - mentioned on 17 May 2012 (Retail Market Monitor, traders corner) Support level revised for Olam mentioned on 25 May (Retail Market Monitor, support and resistance watch) 17 May 2012 (Retail Market Monitor, traders corner) Olam International (OLAM SP, O32) – Grossly oversold condition could be a setup for potential accumulation opportunities Last price: S$1.785 Resistance: S$1.87, S$1.97 Support: S$1.75, S$1.60 The stock has been trading near the lower end of the downtrend channel and S$1.75 could be a potential support level for now (mentioned in last Friday’s note as the next support level). The RSI indicator has a reading of just 11.4, which has never been seen even during the previous sell-off in 2008-09. On 23 Feb 11, the stock sold down with high volume and RSI went lower than 20 and has rebounded in the next few sessions. Should history repeat over the next few sessions, we could potentally see a rebound in RSI and a bullish divergence at the MACD histogram. However, the next support level could be at S$1.60, which is near the resistance level of consolidation area during 2008-09. 21 June 2012 (Retail Market Monitor, traders corner) Olam International (OLAM SP, O32) – Take profit on previous technical note Last price: S$1.96 Resistance: S$2.06 Support: S$1.86 This is a follow-up on our note dated 17 May which stated that the stock could be a setup for potential accumulation opportunities at S$1.75 and S$1.55 (revised on 25 May). We believe some profits could be taken off the table if there is a follow through of the bearish counter attack candlestick pattern formed in the last trading session. The Stochastics indicator has formed a bearish crossover in the overbought region and may turn down. The stock has since returned 12% (accumulated at S$1.75) and 26% (S$1.55). Our institutional research has a fundamental BUY with a target price of S$2.58.
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