PSEi (Chart: Daily Resistance: 3330 Support: 3190/3120)
The resistance line at 3330 held last week, preventing the advance of the index. Nothing much happening on the index, probable trading action for next week will still be sideways to downward movement. It may however trade within a small triangle bounded by the resistance line and the long standing support line from 2006. We are still in bearish territory for the MACD so trading strategy would still be keeping short positions.
EEI (Chart: Daily Resistance: 3.55 Support: 3.00/2.80 )
The long wait had paid off for EEI, the stock bounced from its low of 2.34 reaching a high of 3.55. The stock is very bullish that it consecutively closed higher for the whole week and accompanied by large volume. Looking at the chart, it has just recently broken a resistance line formed from its recent downward move. The resistance line was broken with volume, so this definitely suggests that this stock is now out of the downward move. However, last Friday’s trading is suggesting that the recent bullish move for this stock is now encountering some resistance. The stock definitely has the potential of moving towards near 4.50 level, but it needs to take a breather from the bullish move. So expect the stock to probably move sideways to downward, trading between 3.55 and 3.00. Watchout for the volume on the downward move, low volume on the downward move is good for this stock, but increased volume on the downward move means that a lot are starting to dump this stock. If you had this at the low of 2.34, it would be best to sell a portion of the stock and buy back near 3.00.
CMT (Chart: Daily Resistance: 1.02/1.12 Support: 0.84)
CMT had a bullish run last week, similar to EEI. It consecutively closed higher with volume and on the last trading day, it gapped up with large volume. An area pattern of a falling wedge seems to have formed and the stock has broken resistance at 0.86. This stock has an upside TP of 1.45. Resistance levels along the way up are the Fibonacci retracement levels of 1.02 (50%) and 1.12 (61.8%). Buying at 0.99 is still ok and with-in the 1:3 risk to reward ratio. However, RSI is indicating that this stock is near overbought so it is still possible for this stock to move downwards re-testing support at 0.84. Again watch out for downward movement with large volume as this may indicate that traders are now dumping the stock. MACD for this stock is still below the zero line, so trading strategy for this stock is to hold for the short term only.
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