Browse By

Keep an eye on these multiple signals from SATS S58

SATS prints bearish elements with head and shoulders reversal pattern, staying red after nearly 3 quarters and printing a new low for the year in August.

 

Reversal pattern, negative sentiment and bearish expansion

SATS is a SGX-listed stock and was a local stock darling in 2015 and 2016. When stock markets around the world were at their worst early last year, SATS bucked the trend then quickly went on to print new 52-week highs.

SATS S58 12M chart

SATS S58 12M chart

 

At the moment however, technical signs do not look too rosy.

  1. After nearly 3 financial quarters, the stock is in the red for the year.
  2. Line and candlestick charts for the monthly time frame clearly prints a head and shoulders reversal pattern.
  3. SATS printed the first q-q lower price this quarter since Q4 2014. This is a bearish expansion that terminates the previous 10 quarters of high quarterly lows.
SATS S58 monthly chart from 2013 to present

SATS S58 monthly chart from 2013 to present

 

To be sure, many things can happen between now to end of quarter or even year end. Head and shoulders patterns fail too (we call that a dead cat bounce) so they are not certainty. This bearish expansion in Q3 could be a signal to go short on the indication of a down trend but it could also be a false signal and bargain for investors since one could buy at an 8-month low out of a 2-year uptrend (I might confuse you but this is an excellent concept to think about).

Keep an eye. This post ‘5 price features that set up a good reversal trade‘ might help you manage your trade.

 

5Shares

Director, TerraSeeds Market Technician Pte Ltd. Trader, investor. @sohtionghum was picked ‘Top 70 Forex Twitter in 2015’. Operates multiple strategies.

“Dear reader, I do not have a financial license to give advice. I do not know you the reader. Your financial objective and risk tolerance may be different from mine. I am not responsible for any consequence of your action.

Loading Facebook Comments ...

Leave a Reply