- Olam International could be poised for further correction in the near term with the formation of a high wave doji star candlestick on high volume at its 2-year downtrend resistance line, after rallying more than 45% in the last 2 weeks.
- With the RSI turning down again just under the overbought level, the Accumulation/Distribution indicator falling under its 3.5-month uptrend line and the ROC indicator signaling a sharp bearish reversal high up in the positive territory, these seem to suggest that the uptrend momentum is waning.
- We expect the stock to find initial support at $1.85 (2-month uptrend line), breaking which, we see the next support at $1.50 (resistance-turned- support level)
- Immediate resistance is pegged at $2.30 (2-year downtrend resistance line), ahead of $2.80 (gap zone in Jun ’08).
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