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CapitaMalls Asia and Capitaland: Daily versus Weekly.

Saturday, June 11, 2011

The possibility of a positive divergence panning out for CapitaMalls Asia still exists. With a lower low in its share price, the MACD has stayed at a higher low. However, it seems to be having some difficulty making a positive crossover with the signal line.

I decided to look at the weekly chart and found that the MACD has just gone lower than the previous low. A lower low on the MACD in the weekly chart is a foregone conclusion. It scuttles the chances of a reversal without a positive divergence.

What am I concluding from this? In the short term, there could be support and possibly a rebound but in the longer term, continuing weakness would not surprise me. Any rebound off lows to retest resistance would be good opportunities to reduce exposure.

I recognise the technical signs and would act accordingly. Bearing in mind all the time that TA is about probabilities, I never fully divest. A partial divestment reduces exposure and would allow me to ride any unforeseen reversal to the upside as well.

What about Capitaland? I am going to be lazy here. See the daily and weekly charts below:

Do you see the similarities? No prizes for guessing what am I planning to do with my investment in Capitaland. Good luck to fellow shareholders.

Related post:
An elaboration on my methods.


Hubert wee said...

Some time ago I did have a target price for CMA- $1.50 or $1.60. Unfortunately it has now been met..

AK71 said...

Hi Hubert,

Wasn't it $1.40? ;-)

Prophetic! :)

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