Can Precision Drilling (PD) hold the new support level of $12?
Precision Drilling Daily Chart
The most important points to note in the Precision Drilling (PD) chart analysis are:
The major trend, intermediate trend and near-term trend are all up.
The 40 day moving average is a good approximation of the trend line.
Always trade in the direction of the trend.
There was a breakout above resistance of $12.
Major support is now $12.
The reversal of resistance to support is an important principle in technical analysis.
The breakout was on above average volume.
Trading volume measures the force behind the move.
On balance volume is confirming the upward trend.
The MACD confirmed the breakout.
If an online trader made a buy on the breakout at $12.50, the trader must set up a stop-loss at that time. A reasonable stop-loss would be below support at $12. A stop-loss of $11.87 would represent a loss of around 5% and maybe not close enough that it would be taken out on a light test of support. Anyway, you will be around to trade another day. Risk management is an important concept in online trading. Preservation of capital is rule #1.
A confluence of negative technical indicators for Suncor on the daily chart.
Suncor 6-Month Daily Candlestick Chart
Major support for Suncor is at $40.00 on this daily candlestick chart. You must monitor the chart at this stage for a candlestick pattern that indicates the stock can hold this support level. The near-term trend is down: Suncor has moved below the 10 day and 20 day moving averages. Can the stock hold the 40 day moving average?
This 6-month daily candlestick chart for BMO reveals that the near-term trend is up and the intermediate trend is sideways.
BMO - 6-Month Daily Chart
The most important concept in technical analysis is the trend: you always trade in the direction of the trend. The near-term trend for BMO, last three weeks, is up and is defined by the 10 day simple moving average (SMA) which is above both the 20 day and 40 day averages. The intermediate trend, last six months, is sideways with support at $58 and resistance at $62.
This brings up the another important concept in technical analysis — support and resistance. Take a look at the chart. BMO could not break $62 on three attempts over the last six months. Both the bulls and the bears have memories of this price point. BMO will meet technical resistance at $62 in this rally.
The three confirming indicators:
Volume is relatively light which is a negative indicator.
On Balance Volume (OBV) is trending up with the move which is good.
Relative Strength Index (RSI) is trending up which is good.
The shaven head ( stock closed at the high for the day) white candlestick for Thursday was positive for the bulls.
Note: This analysis is for educational purposes so you can learn to trade online using candlestick charts. Please conduct your own analysis or consult your financial advisor before making investment decisions.
The chart snippets are from BigCharts.com which I recommend and have used for fifteen years.
Shoppers Drug Mart breaks technical resistance at $40 on this candlestick chart.
TradeOnline.ca featured Shoppers on February 6 and highlighted the first bullish white candlestick that developed on above average volume. Above average volume is a confirming indicator and is the fuel that drives the upward trend. The $40 level is now support and the stock must hold above this point for the trend to continue.
Shoppers Drug Mart (SC) 6-Month Daily
Shoppers Drug Mart will meet heavy resistance at $42. You can identify this point on the 3-year weekly chart.
Shoppers was upgraded from hold to buy on February 11 and the price target was raised to $43 from $39.
Note: This technical analysis is for educational purposes so you can learn to trade online using candlestick charts. Please conduct your own chart analysis or consult your financial advisor before making investment decisions. The chart snippets are from BigCharts.com which I recommend and have used for fifteen years.