Wednesday, June 17, 2009

Rickmers Maritime - Island top pattern suggests more near-term downside


Rickmers Maritime is likely to face further correction pressure with the completion of an island top reversal pattern during yesterday’s negative breakout at the $0.56 key support level on heavy volume.

This suggests that the previous rally from its early Apr low may be over.

With the RSI cutting below both the 3-month uptrend line from inside the overbought region 2 days ago and the MACD displaying a sharp bearish crossover yesterday, they seem to echo our views that the further downside pressure could be building up.

We expect the stock to find initial support at $0.45 (the next key resistance-turned support level), breaking which, the next support is likely at $0.32 (all time low)

Immediate resistance is pegged at $0.56 (key support-turned-resistance level), ahead of $0.65 (2-year downtrend line).

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