At BullMarketRun, we’re blessed with some intelligent readers who often send us some excellent suggestions and their own views of where a particular stock is headed.
We often give our own technical analysis, but for another view this morning we have a chart and comments contributed by John from Peterborough, Ontario, who we know does have a knack for this kind of stuff. He, too, has a very bullish outlook on GBB and illustrates below that the next up-move target for this stock is 42 cents.
Some comments on the chart (based on yesterday’s close) from John:
When the peak of 31 cents was reached on Monday, the RSI value was less than the RSI value of the previous high. Immediately that divergence signalled a probable weakening in the stock price in the near future. In this case, it happened almost immediately (on the daily chart there are two sloping green lines which indicate a negative or bearish divergence between the stock price and RSI(7), the relative strength indicator).
The horizontal blue line at 24 cents is a strong support level.
The stock price is above both the SMA50 and the SMA200 moving averages which are rising, creating a bullish scenario. Another bullish indicator is the high ratio of up volume to down volume as indicated in the blue ellipse.
The horizontal blue lines to the left of the stock price are the Fibonacci levels which indicate the next up-move target is 42 cents.
RSI and Slow Stochastics have both been heading down which shows consolidation, which could continue for a while longer. The outlook for GBB remains very bullish.
The passing of 30 cents mark is quite definite but a lot of short time investors are selling at this price… my estimate … at least 1-2 million shares line up. However, this price can be shot up in one day as long as the volume 6 million or above is warranted.
My estimation is still positive to see GBB for over 30 cents within a week. The next set point will be between 32 cents – 36 cents before the big announcement. If GBB goes beyond 45 cents, it will be unstoppable to 75 cents before the end of August. Daily volume is one important factor – $2 million is a normal trade and $ 5 million or more will be the big investor’s buy.
Comment by Theodore — March 27, 2010 @ 9:18 pm