MGV - Chart, page-84

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cafa

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27/09/16

21:41

Post #: 19461062
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Originally posted by wombat53 ↑

@cafa - I think we always have to start with the Weekly chart (and not just for the big picture, but yes, that too). For example...a rally suddenly stops, for no apparent reason. You flip the Weekly..look left and see a very obvious reason - it was an old Resistance, perhaps 2,3 years old. I've seen this lately with stocks as diverse as PLS, RSG, various golds, you name it.
This is what they mean by the slogan "Markets have Memory".
These old holders are still there, and will sell at the first chance after years of miserable drawdown, to finally "break even" (aka "human nature"). This is also called Overhead Supply, or Supply Overhang, and the stock can't go higher (and then higher still ) until those holders are progressively flushed out.
I'll look more closely at the next immediate Resistance level - was a bit rushed before.
The pin bar of 16 Aug (intra-day hi of 9.4c, couldn't hold it, and sold off...) sticks out like the proverbial sore thumb.
Looking left (still on the DAILY), the spike of 10 June up to 10.5, couldn't hold it, sold off and and closed where? 9.5c..not a co-incidence. So we need a decisive close above 9.5..ideally on a Weekly (you can see what happens on a day...just noise).
MGV - DAILY

GLTAH
wombat53

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Thanks wombat!
I got there by a different route, thus I think a solid Close, on reasonable volume at another 10% would be a significant move.

Agree with your view on previous holders being 'trapped' and looking for an exit. Especially those who dived in around the mid 9's.

MGV Price at posting: 9.0¢ Sentiment: Buy Disclosure: Held
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0 Great analysis

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MGV - Chart, page-84

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