Following PX's breakout last Monday from a flag formation, or descending triangle whatever you look at it, San Miguel Corporation is now also trying to breakout from a flag of its own.
After establishing the pole last November 18 and 19, SMC has consolidated between 115.00, and the elusive 125.00 resistance level. Now if SMC will finally manage to breach this level convincingly within the next few sessions, we will be looking at a price target near the 150.00 level, which would present a strong psychological resistance.
To trade SMC, one should wait for the successful assault against the 125.00 level, accompanied with strong volume before buying this stock. Don't preempt any breakouts, and set your stop-loss level below the 115.00 flag support level. With this in place, you should be fine.
While MACD shows that a bearish crossover with the signal line is imminent, chart-wise, SMC still looks good. And coupled with rumors circulating that San Miguel is going to offer secondary shares to the market, with price ranging between 150 to 200 pesos, there is a strong motivation for the jockeys to push SMC towards the 150 levels. Provided of course, that this is true hehe.
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