We love $vdsi but... :S :) :/ :) |
So what makes today's $VDSI action interesting (It only racked +0.68% on a great market day)? The Candle. An extreme hammer that was fought hard to make (4% in height). It was miserable Volume, we know, but it showed the battle to have the stock close in green. We would always wait for confirmation of trend not he next day to call this a bullish hammer of course, nevertheless and interesting candle.
Aside from the candle itself, the moment where it appears is also very odd. A downtrend signaled by the series of lower lows in the past few day contrasted by the pressure signaled by the +SARs. Another sign of two strong trends colliding we believe.
The main chart below shows how this Hammer Candle is the much needed "re-test" of a breakout trend (falling pink line). Huge rejection at the test of this upper support line.
So what do we expect, and what to do? We think:
- We develop a small H&S pattern that will drive the stock back to $24. This will help re-test the MAs and should be a great place to add or buy in as a bounce will be sure to happen. MACD may be confirming this later this week. Keep a tight Stop below MAs if you are for s quickie ;)
- We bounce from long upper level trend line (Pink) and continue with the breakout pushed by Shorts and the latest Hacking news.
- We remain Bullish long term as the stock has been making a series of higher lows since April, also on the RSI and MACD. So if you think about adding or buying into a long position. Use the above points to determine when to buy and come back in August (just kidding, always keep an eye on your investments, just don't faint on the day-to-day noise.)