Healthway Medical: Prime for a rebound?

Although I would not buy more Healthway Medical shares based on its current fundamentals, technically, it looks like it could be an interesting trade.

On 25 Oct, I mentioned that "Two identical dojis formed one after another. One today and one in the previous session. Both closed at 15.5c. Both with a low of 15c. It would seem that Healthway Medical's share price has found a floor at 15c."  Read blog post here.

15c is being tested once again as support. This is the fourth session in a row and volume has been declining.  The 20dMA has stopped declining and has flatlined. Price has stopped moving downwards in recent sessions. The floor at 15c has gained in strength.

Look at the MACD and we see that it seems to be forming a higher low. The MACD histogram has turned green, a buy signal. The MACD forms a positive divergence with the decline in share price. This is a suggestion that we could be seeing a reversal soon. Also, Stochastics is oversold and we could see a bullish crossover soon.

In the event of a rebound in price, we could have the formation of a double bottom with the neckline at 16.5c. If the double bottom is valid in such an instance, the eventual target price is 18c which would break the counter out of the down trending channel.

With lacklustre fundamentals, this would purely be a trade.

Related post:
Healthway Medical: 3Q 2010 results.

China Hongxing: Testing support.

China Hongxing's share price has been declining since hitting a high of 22.5c in mid September. The lower highs and lower lows formed since then have created a down trending channel. Today, price touched 15.5c, a strong support level provided by the 200dMA.

Will price decline further? Well, that momentum is negative is quite clear as the MACD is below zero and still declining below the signal line. However, the MACD histogram has turned green which is a buy signal.

However, any upward movement in price is probably a rebound and not a trend reversal. Any rebound could hit the channel resistance and could be capped at 18c or so. Before that, expect resistance at 17c, which is where the declining 20dMA and the rising 100dMA will be approximating soon.

What hints of the possibility of a rebound is the low volume pull back (i.e. as price retreated, volume has generally been reducing). The selling lacks conviction. Looking at the OBV, we do not see any signs of distribution. Stochastics currently in oversold region and looks like it could be upturning next.

Good for a trade? Possibly.

Tea with AK71: Fallen tree paralysed traffic.

These were a couple of photos I took when a tree fell across all the lanes on Jalan Bukit Merah after an early morning thunderstorm. It brought traffic to a standstill. This was on 18 May and I blogged about it in "Tea with AK71: Life".

Here, we see a car making a u-turn going back the way it came. There was also an entire line of SBS buses on the extreme left lane as they could not move on. All the passengers had to get off the buses and look for alternative transportation.

Working hard to saw up the fallen tree to unblock the road. It must have taken at least a couple of hours before the road was cleared of debris. The metal fencing on the center divider was totally destroyed.

The weather has been getting more extreme lately and we have been told that it would get a lot worse in December. Reminds me of all the movies about climate change.

See "Tea with AK71: Just storms?"