CapitaLand dragged into legal battle in Macau
From : http://www.asiaone.com/News/The%2BBusiness%2BTimes/Story/A1Story20101022-243723.html
I notice a lot of people did not realize that capitaland was dragged into a lawsuit which explains for its weakness despite massive rally in the other blues. But although many may have been bearish for it i am neutral on it and will possibly look to be buying it soon. Nonetheless i am not suggesting of buying it TOMORROW. I will just let the chart continue to develop day by day until i am confident of the move before i will post it out.
News aside let us analyze the chart of capland and see what it is telling us.
First of all,my analysis of it is that it has broken the downtrend and turn to a channeling period.
Why do i think that way?
Look at the downtrend line that i have drawn in the chart,the first point is at 4.45,2nd point at 4.25 so there is 2 point of contact. It takes a MINIMUM of 2 points to make a trendline. Now fast forward to the chart,you can see that from 2nd Aug it broke out from the downtrend line and we had the 2nd test of the trendline support on 1st November when we went down to 3.81 and the support was HELD.
let us look at the horizontal support.
Technically, Capland is now ranging in a channel from 3.81 - 4.22 as the 3.81 level is a resistance turn support which we held, while the 4.22 level is a support turn resistance. Unless we could make a decisvely move with Volume spike in either direction. My recommendation is trade the range from 3.81 - 4.22.
So is this a buy?
Although there are some signs that prove supportive of a short term bounce,it would be hard for it to sustain a move above 4.05 this upcoming week.
Ease of movement is still below 0 region indicating that even if there is a bounce to 4.05 from current level(about 13cents only),the bears still have a upper hand. Hence i would be adding this stock to my watchlist to look for opportunity to go long in it within the next 2 weeks. I will update further when the conditions has aligned properly.
I welcome people to suggest counters for me to do an analysis on,i hope to be able to share with you all the different aspects of putting the probabilities in your favor using simple methods.
