Technical Pulse: Meituan Dianping October 28, 2020 1038

Meituan Dianping (HKEX: 3690) Strong upside is set to continue once more despite the wave analysis indicating a risk of a corrective expanded/running flat ongoing. All technical and price actions are pointing towards another round of upside:

  1. Wave analysis indicate the completion of the intermediate impulse 5 waves from March to late August. As such, the current wave action is pointing towards a corrective flat as prices fails to close above the all-time high at HKD$278.80 on 14th
  2. Although there is some pressure of selling after Meituan fails to clear above the all-time high level, the formation of a pennant indicate a possible upside. Furthermore, the piercing line candlestick lay perfectly on the base of the pennant.
  3. Target resistance zone confluence with 127.2% of wave (A) and 161.8% extension level of the pennant. Coincidentally, both Fibonacci extension level is nearing the HKD$300.00 psychological resistance level.

 

*Timeline of the trade is 3 weeks from the date issued.

*Should the pennant fails to materialise, Meituan will likely find itself rebounding at HKD$249.20-HKD$241.20.  

 

CHART LEGENDS

Moving average

Red dotted line = 200 periods Moving average

Blue dotted line = 50 periods Moving average

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