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It has been five days since Supermax's retracement occured. The deepest dip is at RM18.08 which is equal to 26% from its peak. As to current date, the plunge from its peak is valued at 20%. There is a fibonanci support line at the level RM19.40 which was previously a resistance line which tested twice before it breakthrough. I still believe that this support level is effective although the share price closed below it yesterday. Gap up in the morning and pushing up of the price in the last few minutes can contribute to the reliability of this support line as today closing is above it.
Surprisingly, I have noticed a trend reversal chart pattern has been formed. From the image inside the link i have given, we can see that the last two candlesticks are forming a reversal chart pattern named Harami Cross Pattern. This pattern shows that the current trend is on weakness and going to be reverse. I believe that the selling power is getting weaker and weaker therefore this chart pattern is formed. This could indicate that the Supermax is starting to recover from its plunge. I hope that this chart pattern could take effect and cause the share price to increase steadily up back to its peak and break new high. Remember, every trend reversal will most likely to break its previous high. The previous high of Supermax is at RM24.44 which is roughly 25% from current share price.
Besides, there is a potential Island Reversal Pattern to be formed in hourly chart. This pattern indicates a trend reversal too. I'm hoping the Harami Cross Pattern will bring up the share price followed up by a gap up to form this pattern. If it is formed, the trend reversal shall be confirmed and the price will definitely shoot up and break new high.
I believe that Supermax is not yet dead and will break new high in the future since it is a company which has a strong fundamental background. Let's hope for the best for Supermax! Cheers.
Good afternoon, the confirmation candle for my analysis is not forming for now. I believe it is cause by the announcement of GDP. But, the trading day has not yet ended. Let’s see the afternoon session can bring us to what conclusion. Cheers.
@Mark Chow. Today's candlestick showed that the previous pattern "Harami Cross" is rejected. The potential Island Reversal pattern might not be form in a short period due to no sign of price turning up. The next support line will be at RM17 and RM14.5 respectively. Note that technical analysis is just for reference. Current market are filled with too much uncertainties and emotion which make TA more unreliable. Stay put with your strategy as discipline is important factor for an investor. Have a good weekend! Cheers.