CapitaMalls Asia: Bought some at $1.85.

Just last night, I said "With all the momentum oscillators forming lower highs and the OBV showing obvious distribution, going long on this counter now would be most risky. Any upmove could simply be a rebound from oversold conditions and would find immediate resistance at $2, a recently many times tested resistance level and it is also where we find the declining 20dMA. I have my eyes on $1.88 and $1.85 as possible fair entry prices."

Well, my overnight BUY queue at $1.85 was filled. What is my plan now? Well, prices don't go down in a straight line. If there is a rebound, I expect resistance at $2.00 and that is where I would divest for a trade. The likelihood of this happening in the next few weeks is not at all remote.  Look at the MFI, it seems to be forming higher lows. There is still some underlying demand for this counter's stocks, it would seem.

However, looking at how the volume expanded dramatically today, almost tripling compared to yesterday, we cannot help but wonder if price could weaken further. Using two sets of Fibo lines, the first using $1.91 as the extreme low and the second using $1.84 as the extreme low, we see $1.65 showing up as 161.8% Fibo line in the former and 138.2% Fibo line in the latter.  That is the ultimate strong support in case of a continuing sell down with heavy volume. That's a fair bit to fall from $1.85 and I will have my warchest ready.

Related post:
CapitaMalls Asia: Testing historical low.

CapitaMalls Asia: Testing historical low.

On 9 Dec, I mentioned: "Closing at $1.92 is at support provided by the 138.2% Fibo.  38.2%, being one of the 3 golden ratios, is quite strong and if it breaks, the other 2 golden ratios are 50% and 61.8%.  The 150% Fibo and 161.8% Fibo lines are at $1.88 and $1.85 respectively. If the selling pressure keeps up, we could see prices go to those levels. Then, I would be sorely tempted."

Price formed a wickless black candle as it tested the counter's historical low at $1.91. The difference? On 7 May, when $1.91 was touched, a white candle was formed. It looked like a white spinning top with a long body which was a potential reversal signal and it delivered. This time round, a wickless black candle was formed as price closed at $1.91. The picture is more bearish now, for sure.

With all the momentum oscillators forming lower highs and the OBV showing obvious distribution, going long on this counter now would be most risky. Any upmove could simply be a rebound from oversold conditions and would find immediate resistance at $2, a recently many times tested resistance level and it is also where we find the declining 20dMA. I have my eyes on $1.88 and $1.85 as possible fair entry prices.