HONYFLOUR: Stock has bottomed out; just grab the opportunity


Monday, August 17 2015 09.50 AM / Harish Shahi, The Analyst 


A closer look on the daily chart of
HONYFLOUR reveals that earlier stock was making successive lower lows and lower highs followed by a strong blood bath heading towards south side.   A downtrend line is also lying on the daily technical chart which is providing supply pressure.  Bears were controlling the game and that was limited to N2.60 level.

After arriving at N2.50 level bears are struggling to decline further and are unable to move on further downside. It seems that the bottom out process is going on; at the same time bulls are trying their best to get the price at upside. This is an early bull call we will get further confirmation once stock trades and settles above N3.20 level.

There may be a lot of demand in the market and N2.60 continuous to be a very strong support
. The short term trend is down according to the daily swing chart, and momentum appears to be favour to the upside. A sustained move above N3.20 will signal the presence of buyers and will provide more strength to the bulls; this could trigger acceleration to the upside with N4.00 as next target. 

All odds are in favor of the bulls and indicating a bullish signal. Presently, stock is trading below all major and minor EMA lines but candles are generating reversal signal. Both investors and traders are displaying bullish tendency towards the stock for the time being.

To View Technical and Interactive Chart with Indicators like MACD, RSI, Stochastic, Moving Average, Bollinger, Williams %R, MFI ... Click HERE


What Next?

A harami candlestick followed by two consecutive bullish marabuzo candlesticks at strong key support level is providing us some reversal signal. Both RSI and CCI indicators are providing trend reversal signal from oversold territory and generating neutral to bullish signal.

Intraday bias remains bullish on the stock as long as N2.20 level remains intact. The N3.40 level is key resistance level followed by N4.00 whereas N2.00 can be considered as key support level followed by N1.50 level.

Trade Idea:

Based on the charts and explanation above, traders and investors can buy at N2.87 level for the target price of N3.20 and N3.60 level with the stop loss of N2.40 level.  The tentative time frame would be 8-10 days.

NB: Return on Investment based on trade idea above does not take cognizance of brokerage commission charges   

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To View Technical and Interactive Chart with Indicators like MACD, RSI, Stochastic, Moving Average, Bollinger, Williams %R, MFI ... Click HERE

For further details, kindly contact analyst@proshareng.com 

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