HL Asia in long downward channel

Good day everyone,

I was quite busy throughout the past week, and so I could not come on here and post anything. Anyways, I have identified a new chart pattern on HL Asia. It is a large downard parallel channel, that started forming since July of last year. You may want to check my past posts on HL Asia, as there have been quite a number of chart patterns on HL Asia’s chart. For now, I will continue to hold a bearish view on HL Asia’s stock price. One other thing to note is the bearish indication from the moving averages. The 50-day MA is below the 200-day MA, and I am sure whatever moving average you use are also pointing the same picture. More importantly to me, price is – or has been for a long time – under the 200-day MA.

 

I zoomed in on the chart, and took out a few indicators just to see what the indicators are telling me. Price has just made a lower low on the chart, however, indicators like the CCI and RSI have made a higher low. This is a positive convergence, which tell me that price may face short-term buying pressure.

I will not be too optimistic though, seeing how the general trend is downwards.

Finally, the question begs: Where will HL Asia go to, now that another bearish pattern is on the chart?

I whipped out a fibonacci retracement study to find out where the next support level is at, which will double up as a target as well. Click on the chart below for an enlarged view of the chart. Look at the yellow arrows, that depict price action at the fibonacci levels. Although the past weeks show price zig-zagging around the 50% level of $2.70, being under that level mean that $2.70 is a resistance level for me. the 61.8% retracement level comes in at $2.17. With a bearish chart pattern, I can only expect HL Asia to continue sliding down to $2.17. There is a support trendline (in green), but I think price can break through this support easily. Any rallies should have no problem testing the 200-day MA, which is now at $3.10. I am not in support of that view though, as chart patterns are most important on a chart, and currently, I see a downward parallel channel.

All analyses, recommendations, discussions and other information herein are published for general information. Readers should not rely solely on the information published on this blog and should seek independent financial advice prior to making any investment decision. The publisher accepts no liability for any loss whatsoever arising from any use of the information published herein.

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