My last chart post on SYA was back in April. I was looking for the 5.2c level to hold as support after the relatively Very High Volume Close on24/04 at 5.2c. Unfortunately this level turned into resistance and the SP moved lower. It looks like the High of that “Anchor Zone” bar is now a significant resistance level. The other significant High Volume Anchor Zone level in the past is the Low of the Stopping Volume bar of 06/02. I have drawn two horizontal lines identifying these levels on the chart shown below. Also on the chart I included the “WaveTrend” indicator that I have only just recently started using. This indicator seems to be very good at identifying heavily OB (Overbought) and OS (Oversold) areas.
View attachment 1206270
Unfortunately I lost focus on the SYA chart, until recently that is. I’ve spent a lot of time researching TA methods that can be used for what I call “Bottom Fishing Search” (BFS), could also call it a “Best Friend Setup”. I thought I’d share the setup that occurred on SYA on 11/07. Actually this is the third of these setups that I have found recently.
Referring to the above chart – the BFS setup is as follows (note that the order is not important):
- Identify short term resistance line;
- Identify new relatively High Volume Anchor Zone level (VAZL) (this is the Close of 05/07);
- Observe SP price action above the new VAZ support level;
- Identify cross of WaveTrend indicator to up from the heavily OS level;
- Buy on Close above (break of) short term resistance line, i.e.3.8c on 11/07.
As mentioned above this is the third of these setups that I have identified on different low cap spec stocks in the past week or so. All I have to do now is find a way of programming the required resistance/breakout level calculation and I can automate the whole search. I would be interested in hearing from anyone out there who also performs these types of searches, automated or manual.
Now getting back to the current SYA SP action. On the chart shown below the MMAs (Multiple Moving Averages) are indicating the first stage of a possible trend change to UP. Long Term Momentum turned up on 11/07. The recent SP action stopped at the 200MA which is right in the centre of the resistance levels identified previously. At this stage the short term cycle indicators (stochastics) have turned down so I would be expecting a further consolidation of SP action below the 200MA. So in the short term I’ll be watching for a confirmation of the expected trend change. The support levels on any correction move back down are the 50MA and then the current Anchor Zone Close (horizontal dotted green line).
SP targets on a confirmed resumption of an Up Trend are around 6.5c, a previous Anchor Zone level and the Fib 50% retrace level of the move from 1c to 12c, and then the 8.c level followed by the previous high of 12c.
View attachment 1206276
Good luck everyone – and remember to DYOR!
(20min delay)
