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ASTI: Breakout, almost.

Monday, September 20, 2010

A friend called me and asked if it is too late to buy some shares of ASTI.  Yesterday, I said "I see resistance at 12c which was tested several times in recent months.  It is, however, also interesting to note that we might be seeing the formation of an ascending triangle here with 12c being the top of the formation.  If  the resistance at 12c is taken out, I see immediate resistance at 13.5c with a near term target of 15c." Today, 12c resistance was weakened as price briefly touched 12.5c before ending the day at 12c.  This means that 12c is still resistance and we need to see if it could be taken out in the coming sessions.


So, should my friend buy some shares of ASTI at 12c? Buying at 12c would be buying at resistance. Not a very good idea. However, the very high volume today which accompanied the buy ups is encouraging.  Of the 20,050 lots that changed hands, 15,573 lots were buy ups. 10,369 lots were bought up at 12c.  Could this momentum continue? Let's look at the momentum oscillators for clues.

The MFI has formed a higher low.  So has the RSI.  The MFI is just going into overbought territory while the RSI has spiked into overbought territory.  OBV has also spiked upwards.  Demand is rising. Buying momentum is strong but overdone.  Accumulation is in full swing.  Overall picture looks good.  There is a good chance of a follow through and if it happens, we could see 13.5c tested.  Otherwise, supports could be tested once more. It would be safer to buy in then.

Related post:
ASTI: A doubling of share price in time?

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