Mid-afternoon take: AusGroup

On 9 Jan, I wrote in a post that "AusGroup had a sell signal on the MACD on Thursday (7 Jan). In the near term, price seems set to go lower. Initial support is at 69c, a many times tested candlestick support level. The cluster of rising 20dMA, 50dMA and 100dMA, all within close proximity of each other, should limit downside to 66c which coincides with the 50% Fibo line."AusGroup

AusGroup closed at 68.5c in yesterday's session and is now hugging the 100dMA and the 20dMA supports which are at 68.5c and 68c respectively. MFI has formed a lower high indicating weakened buying momentum and the OBV has gone flat. Despite the ugly black candle formed in the last session, the uptrend is still intact. If the support at 68c gives way, next support is provided by the 50dMA at 66c.

The current uptrend is negated if price closes below 65c this week. From a technical perspective, the probability of this happening is rather low. Having said this, we want to see AusGroup forming a higher low to confirm the uptrend in the next few sessions. The previous low was at 63c on 23 Dec 09.