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NOL: A messy ascending triangle?

Monday, October 17, 2011

Could this be an ascending triangle I see in NOL's chart?

Although ascending triangles are usually seen as a continuation pattern in an uptrend, a breakout could send NOL's share price higher to test resistance provided by the descending 100dMA which is currently at $1.32.


The 20dMA is set to form a golden cross with the 50dMA and is likely to provide immediate support at $1.115 in case of a pull back.

MACD shows that momentum is clearly positive now while the MFI shows higher lows, suggesting that demand is strengthening. The MFI which takes into account both share price and trading volume could test the 50% line for support if volume continues to dwindle while price stays at resistance.

As NOL's share price seems to be finding a floor if not bottoming, looking at the Stochastics provides us with insight as to why it seems to be having a hard time moving higher. This momentum oscillator is, after all, more accurate in situations where prices are moving sideways. The Stochastics has risen into overbought territory.

All in all, this TA seems to suggest that buying if the share price should pull back to support is a good idea because there seems to be a bias for an upward movement in the shorter term.

2 comments:

David said...

AK71,

always reading your blogs to learn from those who are good at analysis.

Do you have any thoughts on Berlian Laju? I read today in BT, that the rates for LNG shipments have gone up the roof x 2 times in Europe, probably due to winter, and that should also have impact to companies such as BL who're into this business. Not sure whether NOL is in this business.

AK71 said...

Hi David,

NOL is in container shipping, not bulk shipping. In terms of FA, expectation is for more weakness due to overcapacity. TA, however, is showing some short term bullishness.

As for Berlian Laju, I have not done any detailed FA but if I remember correctly, its business is mostly restricted to the domestic market of Indonesia.

You might want to visit "The Wealth Buch" as its blogmaster, JW, is vested in Berlian Laju and has done FA on it before. :)

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