Chart courtesy of www.advfn.com
This is technical analysis of Global Ferronickel Holdings (PSE:FNI) based on the chart as shown above. There was a break-out of this stock, (PSE:FNI) symmetrical triangle near 2.30 to 2.35 area. As of 20 March 2015, FNI last traded price is 2.41 from the previous close of 2.30.
A parallel line can be drawn which will be the initial target price at 3.0 on this potential big move once the resistance near 38.2%, 50% and 61.8% fibonacci levels will be broken. This is the initial target price near the upper trend-line which forms a parallel line.
Global Ferronickel Holdings Inc (PSE:FNI) is on potential bearish reversal or bounce after the breakout from symmetrical triangle pattern.
The stock may fly high after the resistance at 78.6% fibonacci near 3.10/3.11 area will be broken. The catalyst on this big move (may not be immediately) may be after the FOO or during the FOO or possible new business acquisition or anticipation of the full net income 2014 (as we all know the big surge of 6-month 2014 net income) and the better first quarter 2015 net income as compared to 1Q2014 based on initial forecast. (Expect that technical analysis is combined with fundamentals as the name technimentalist 😉 )
In the clearer view of the chart:
In the short term, we have to observe first if the price action is an end of the bearish trend or counter-trend bounce since it is approaching near the 38.2% fibonacci. If this resistance is broken at 2.43 to 2.45 area, which is possible next week based on the existing signals, another resistance near the 50% fibonacci at 2.63 to 2.65 levels.
Another reference other than fibonacci retracement levels for support/resistance, the support-turned resistance on February 24, 2015 is located at 2.52 and on January 19, 2015 at 2.69 based on the daily chart. Weekly chart has not shown/confirmed yet the sign of trend reversal.
We have to check first the validity of the trend with other technical signals to confirm this reversal as this might be failed bounce especially that it is approaching the 38.2% and 50% fibonacci levels although stochastics and ultimate indicators have positive sign in a daily chart. Technical signals can be confirmed with candlesticks, momentum indicators, volume and chart patterns as these are confirming factors for a more robust signal.
For position traders like me, you can just check the status of the price action after the holy week 😉
Disclaimer: This article is for information purposes only. There are risks involved with investing including loss of capital. The information provided in the website is only an opinion of the author and does not constitute as legal advice, research or recommendation to buy or sell any securities. The author of this article may be biased as he has accumulated shares of this stock.-)