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Armstrong Rallies; Profit Taking Ahead Of 2007 High
Trend Spotting | 14 June 2010
By: Soh Tiong Hum
Articles (84) Profile

Armstrong has outperformed the STI by rallying to a 52-week high. Unlike the STI, this stock has stayed above all of the long and short term moving averages, an evident of strong momentum. Indeed, it was able to do so because it built a base between $0.335 and $0.39 over a space of 6 weeks. This consolidation allowed bullish participants to accumulate. There are now few clues for resistance.

But wait! Friday’s selling came with a decisively bearish candlestick as well as high volume. The latter rings alarm. A look further back tells us trading reached a high of $0.46. Mid-2007 high was at $0.485 (on 31 July 2007). Friday’s trading could be a profit taking ahead of anticipated resistance.

For those deep in the money, resistance may be a time to keep some profit in the pocket. Those who have not entered should be wary of buying too near resistance. Look for a base to enter.

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Soh Tiong Hum is a regular contributor to Tiong Hum can also be found and followed on Google+

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