Join Dstockmarket's Community - Daily Market Analysis, Individual Stock Analysis.
It has almost been one month since I look at Ann Joo. But the technical principles still work in Ann Joo as with all other stocks around the world. I highlighted that Ann Joo was correcting to the rising 200 MA in my past analysis and this is usually a good place to find trades.
A trader can look for signs of bottoming by anticipating bullish reversal patterns as a stock corrects to the 200 MA. In this case, Ann Joo formed a 60 min ascending triangle and gave traders a really nice explosive trade.
Do remember the 200 MA support is an area and it does not mean a stock will magically bounce up when it hits the 200 MA. In Ann Joo, we can see it break a downtrendline and then shot higher. At this moment, I think the nice swing trade up is over as Ann Joo hits the resistance area.
So I expect a correction or at least a sideways trading in this stock as it absorbs supply from the resistance. Timing is always important to make money in the markets. One should not go in when it feels good but only when the stock hits an important area.
The chart above shows the 60 min chart of Ann Joo. As you can see the stock formed a 60 min ascending triangle breakout as it drop near the 200 MA. This provided a nice explosive swing trade for observant traders.
Its always a good idea to look for ascending triangles when your stock hits the 50 MA or 200 MA. Currently, the stock is trading sideways in a trading range and this will be important for traders to watch. If Ann Joo can break above the box consolidation then it might go higher. On the other hand if it breaks below the trading range, some selling will happen.
Although still in a weekly uptrend, Ann Joo's share price has been correcting quite a lot lately. It is now near the 200 MA and price support.
I think the correction in Ann Joo has made quite a lot of investors nervous about the prospects of this stock. But it is normal since the stock's price reached the former highs that was set many many years ago.
The chart above is the daily chart of Ann Joo's share price.
There is a price support area in the chart and Ann Joo is correcting to that area. Furthermore, the stock is about to meet its rising 200 MA which is a powerful psychological support for any stock.
You might want to watch out for this area carefully because it will be crucial to Ann Joo's long term future. I believe that as long as Ann Joo's share price can stay above the area of 3.00 then it will continue to go higher in the long term.
The chart above is the weekly chart of Ann Joo.
As you can see, the stock is still in a very very nice uptrend. There is no change of trend yet as far as I can see. There is just a slowing of momentum which investors already expect since it is hitting the area of old highs set about a decade ago.
Again, I would just like to say that as long as Ann Joo can trade sideways above the support area, things will be fine for Ann Joo in the long term.
When you look at the monthly chart of Ann Joo below, you will understand why I say so.
The chart above is the monthly chart of Ann Joo.
The stock started its massive price run up after it broke a monthly downtrendline. Breaking a long term downtrendline is a powerful catalyst that can send a stock higher. Which is why you need to pay attention to long term charts if you are serious in making money in the Malaysian stock market.
You can read about this technical concept in this article I have written, Breaking A Long Term Downtrendline where I will show you how Apple and Netflix started a big bull run after breaking their long term downtrendline.
When you look at the monthly chart, you can see why Ann Joo is behaving so irrational in the daily charts. It is hitting an area of former highs. Stocks tend to halt when they hit old highs.
You will also notice that there is a strong area of support around the 3.00 area.
This is very significant.
From what we can read in this long term chart, Ann Joo is resting after a long run up. There is support below. So, as long as the stock can stay above the 3.00 area and trade sideways, I believe it will eventually overcome the old highs and make another new high in the future.
Hope this helps. Do supplement your own analysis with this analysis I have done.
Happy trading and happy investing!
Jun 29, 20 08:04 AM
Technical analysis of the KLCI for the month of June 2020. What is likely to happen? Read here.
Jun 29, 20 08:03 AM
Well, sell in May did not materialize for the S&P 500 but the market continues to chugg higher. What is in store for us this month?
Apr 30, 20 07:49 AM
What is the stock market likely to do from this impact of the Coronavirus? Will it continue to fall or a bottom is near. We will use charts to guide us.
Apr 30, 20 07:44 AM
The Malaysian stock market has been badly battered following political uncertainty and the Coronavirus. Let us chart the KLCI and see where it is likely to go.
Apr 24, 20 07:20 AM
Want to learn a trading strategy that is less stressful and that will allow you the freedom of not looking at the markets everyday?