CHAMPION: Stock is about to bottom out; After steep sell-off


Monday, August 10 2015 08.30 AM / Harish Shahi, The Analyst 

A closer look on the daily chart of CHAMPION reveals that stock is falling down and making successive lower lows and lower highs and heading towards south side. The strong sell-off or blood bath can be seen from N8.93 level to N4.71 level. Well bears have arrived at N4.71 level which is a strong key support level while stock has received panic demand from this level earlier also.

To buy at this level would have good risk and reward ratio as it has recorded almost 100% retracement level and chances of bouncing back is very high after steep sell-off.

There may be a lot of demand in the market and N4.50 continued to be a very strong support level.

 The short term trend is down according to the daily swing chart, but momentum appears to be in favour of the upside. A sustained move above N6.0 will signal the presence of buyers and will provide the more strength to bulls; this could trigger acceleration to the upside with N7.0 and N8.50 next target. 

Well odds are in favor of bears now and indicating the bearish signal. Presently stock is trading below all the major and minor EMA lines and candles are totally generating bearish signal. Both investors and traders are displaying the bearish 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 hammer candlestick followed by dragonfly doji candlesticks are providing bullish signal. Both RSI and CCI indicators have reached an extreme oversold territory and are generating bullish signal. Well it’s just a start; we will get further bullish signal once stock trades and settles above N6.0 level.

A bullish crossover on the MACD indicator is about to take place which will provide a bullish signal. Intraday bias remains bullish on the stock as long as N4.00 level remains intact. The N6.40 level is key resistance level followed by N8.40 whereas N5.00 can be considered as key support level followed by N4.40 level.

Trade Idea:

Based on the charts and explanation above, traders and investors can buy at N5.00 level for the target price of N6.50 and N7.50 level with the stop loss of N4.00 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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CHAMPION Blood bath is going on dont buy at the moment - Proshare

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

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