Healthway Medical - Rising too quickly?

Healthway Medical opened nicely enough as it gapped up at 16.5. The buy up at 17c which we identified as an intermediate target was fierce but 17c proved ultimately too strong to be taken out today even as trading volume increased. Closing at 16c is a sign of near term weakness. Any decline in price will find support at 14.5c, the top of the previous cup formation which was resistance and now turned support. Any further decline in price will find support at 13c where three rising MAs are converging. This might just have been a case of rising too quickly as we see the MFI crossing into the overbought territory.

Fundamentally, Healthway Medical provides much better value compared to its peers. This picture has not changed. Any short term weakness in price will provide an opportunity for investors who have been waiting on the sides to jump on the bandwagon. Eventual target remains unchanged at 19.5c.