Wednesday, March 08, 2006

MFS Tech (5BM) - Breaks out of Resistance, acheive new High!



MFS Tech (5BM) depicts a nice chart. Breaks new high. Again, anyway you put it, it is bullish. As in Chart A, we can see the Resistance of $1.04 broken and also the breakout from the Triangle. The Guppy Chart also showed strength of good uptrend; all the way up. In line with in, the ADX 5 day confirmed an inevitable continuation of up thrust. This is evidenced in the reversed small up tick with D+ positively placed. Our fear of ADX height and its about turn is muted as from its history; (5BM) tends to reverse only at approx 62! To add confidence to this believe, RSI 5days is exhibiting a very strong upward move towards 78. Put it critically, it is overbought. CCI 5 day agreed with it at 100. But looking at it, both are upward and not curling down yet. Hence, risk is worth taking. Volume at 7 mil, same figure as the past average 10 periods. This is normal. But the note worthy point is that volume is increasing over prior period.
Let’s cross over to chart b. All the good things in life! Breakout from Price Channel and Bollinger Band. Bull seems to appear judging from a white Hammer (in concept only –because tail must doubled its body and in down trend to form a prefect Hammer). Also notice the bullish divergence formed between the price and its momentum. Prices are likely to advance and sky is the limit. If the correction ever set in, be prepared to respect the 97 and 91 cents as support. Fundamentally result was out 2 days ago and its declaring of dividend. The market is now reacting to it. I think there is a rumor of it being a take over candidate. This could be the saint propping the price now!

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