Hock Lian Seng:Target hit.

On 27 Sep, I mentioned that "A support seems to have formed at 30c for this construction stock.  Further upside would give a target of 32c." Today, Hock Lian Seng's share price touched a high of 32.5c before closing at 31.5c as volume exploded.

The MACD completed a bullish crossover in positive territory as the MFI spiked into overbought territory while the OBV turned up sharply. The RSI, however, is somewhat lukewarm and has yet to break out from a series of lower highs.  This coupled with a white candle formed today with a long upper wick puts into question the sustainability of today's upmove in price. Interpretation: Strong demand and accumulation but buying momentum is muted by strong selling pressure at resistance (32c).

I sold some of my shares at the 32c target today. Although I still see strong support at 30c where we find the rising 20dMA, 30.5c could very well be resistance turned support. I would buy again if it gets to those levels. Immediate resistance remains at 32c and if that breaks convincingly, the next target is at 34c.

Related post:
Hock Lian Seng: 32c target.

Raffles Education: A trading opportunity.

I have not done any trading for a long time.  Today, I took a look at Raffles Education's chart and it looks to me like a positive divergence is forming between the downtrend in price and the MACD.  As price formed lower highs, the MACD has been forming higher lows.  Last week, a higher low in price was formed.  This is a positive sign.

Look at the MFI and we see higher highs which suggest increasing demand. Look at the OBV and we see accumulation strengthening.  Look at the RSI and we see higher highs which suggest positive buying momentum.  These signs point towards a possible reversal of the downtrend.

Also, as price declined in the recent sessions, volume similarly declined which suggests that a classic low volume pullback is taking place. There is an absence of strong selling pressure.

Having said all these, immediate resistance at 29.5c has to be taken out convincingly.  If this is achieved, I see an eventual target of 34c (161.8% Fibo and also defined by the descending 200dMA) with some resistance at 32c.  Good for a trade? Perhaps.

Related post:
Raffles Education: Downtrend in force.