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In my last blog post on the REIT, I suggested that the downside proposition looked more persuasive but I was also beginning to see positive divergences. Today, the MACD turned up and formed a higher low.
Price moved higher and closed at 73.5c. I think the positive divergence has been validated. However, rising on rather low volume is lacking in persuasive power.
Technically, the REIT is still in a downtrend which started on 20 Jan 2011. The trend resistance is at 74c. If price is able to break 74c convincingly, by this I mean with higher volume, we could see old highs tested as the downtrend breaks.
Unable to break the trend resistance at 74c could see the REIT trading lower and I would not be surprised then if the rising 200dMA should be tested for support. This is still at 70c.
Related post:
First REIT: Buying more?
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