China Minzhong: Crossroads.

China Minzhong's share price has been forming a base. It is clear that immediate support is now provided by the 20dMA which has stopped declining and is, in fact, gently rising. A rising MFI suggests that there is an underlying and growing demand while the sharply rising OBV suggests that smart money is moving back into the counter as its share price moves sideways with an upward bias.

The MACD, although rising, is still in negative territory. However, this could change soon as it could cross into positive territory next week, everything remaining constant. Could a change in trend take place soon? It looks possible.

The 50dMA is still declining sharply and we should see it crossing the 20dMA in the next week or so. If the share price is able to stay above the 50dMA then, we could see much more room for moving upwards.

A major resistance would be a gap fill at 82c which, incidentally is where the 100dMA and the 261.8% Fibo line are approximating. Before that, however, I expect resistance to manifest at 71c which is where the 161.8% Fibo line approximates.

Immediate support is at 59c thereabouts.

Sound Global: Would I buy now?

Fundamentally, a top down approach suggests that the industry Sound Global is in will continue to do well as governments invest in solutions to water related problems. My past research and experience with the company when it was known as E-pure also gave me the confidence required to invest in the company again although my initial re-entry price of 59c was less than ideal.

In the subsequent market sell down, I bought more shares at 46.5c on 31 May 2012 which means that my long position is now in the black. I am looking to possibly locking in some gain as the charts seem to suggest that this could be a good idea.

In the last session, a black candle was formed on the back of higher volume, suggesting that the bulls had a hard time pushing the share price higher. Do I see signs of distribution? Well, the OBV is still rising which does not suggest that smart money is leaving as price moves higher. Accumulation is still going on.

However, the lower high on the MFI which measures demand suggests to me that buying momentum is slowing down. Then, looking at the MACD histogram (MACD-H) which is a measurement of the distance between the MACD and the signal line, we see lower highs too. The MACD-H usually precedes the MACD itself. So, a change in trend could be on the horizon.

Could Sound Global's share price move higher from here? It could but the technicals suggest that it could be a slow grind upwards if it should happen. Would I buy more then? Probably not as I feel that, technically, selling could be a more palatable proposition.