Well...what to do?13 Dec 2016 21:38
In candelstick terms as far as the chartist would read it we may have a short term reversal of trend developing. Today was a Gravestone Doji, where price rose to start with under continued buying pressure, but then the sellers took over and drove price back down to close at the same as it opened. Obviously the 20p level was a target for a group of sellers who decided the run had gone far enough..for them at least.
The rule is that if the sp opens lower tomorrow or starts to move down shortly after the open then the pattern is confirmed.
It would be a difficult one to trade for several reasons...first, we are still in an rising trend so there will be plenty of players believing that `the trend is your friend` so you couldn`t prise their shares off them with a s*it;y stick.
Secondly, if you did sell first thing in the morning is there enough % distance down to the next `obvious` support level to make it worth it to buy back..bearing in mind that how do you determine if support comes in at a FIB retracement level (17.8p or 16.25p etc), or if it bounces off trendline support @ c18p, or if it bounces off the 50day exp moving average at ~16.5p.
Thirdly, is the spread going to knock too much off any gain to make it worth bothering with the risk.
And fourth, this is AIM, so are they going to let you back in when you want to buy back, there`s been plenty of times in the past when I`ve done dummy sells, or buys, only to get the `we cannot process your order at this time, please try again or weep in your wine...loser!!`
BUT...after all that, a Gravestone Doji at the top of an uptrend has not appeared on OBT`s chart as far back as I can see, and it is quite a strong signal...after a good run...so maybe worth the sell risk.
Decisions decisions