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Healthway Medical: Closed the gap at 15.5c.

Monday, December 20, 2010

On 13 Dec, I divested my trading position in Healthway Medical at 17c, saying that "I expected 17c to be a strong resistance as it is where we find the merged 100d and 200d MAs as well as the downtrend resistance line.  So, a trading position entered on 22 Nov last month at 15.5c was divested at 17c today." and on 14 Dec, I mentioned that "Price could first retreat to 16c, a many times tested resistance and now possible support, before closing the gap at 15.5c."

Healthway Medical closed the gap today at 15.5c. Am I expecting more downside? Share price is pulling back from almost overbought conditions and I do not expect any huge downward movement. Notice that the decline in share price has been on the back of reducing volume. This is good news for the bulls. Also notice that the uptrend in the MFI and RSI are still intact. However, the charts suggest the possibility of both indices to retest their supports. This could mean a reduction in price or volume or both in the near future. A successful retest of supports could lead to another upward movement in price.

Immediate support at 15.5c.  This is followed by 15c and 14.5c.

Related post:
Healthway Medical: Still at resistance.


Ken said...

Would you pls enlighten me on the downward resistance line ( i think its connecting all lowest point?) n how can we determine it?

I suppose uptrend is the entire opposite?

Thank u

AK71 said...

Hi Ken,

Connecting a high with a lower high would give us the downtrend resistance line.

See my blog post of 13 Dec for illustration:

Healthway Medical 13 Dec 10

To find support in an uptrend, connect a low with a higher low. :)

Ken said...

Thanks for your answer :)

AK71 said...

Hi Ken,

You are welcomed. :)

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