Technical Pulse: Nongfu Spring Co Ltd February 7, 2023 429

Nongfu Spring Co Ltd (HKEX: 9633) Potential breakout of a consolidation triangle to retest the confluence of uptrend channel and previous swing high resistances at HKD$52.00:   

 

  1. The price has consolidated in a triangle and has been forming higher lows recently, a bullish signal for a potential breakout.
  2. The Moving Average Convergence Divergence (MACD) technical indicator is currently displaying a bullish momentum with the sustained crossover of the MACD line over the Signal line, while remaining above the zero line.
  3. The price could first retest the HKD$48.35 level in the resistance zone of HKD$47.40-49.00, confluent with previous swing highs formed in March & October 2022. It could then head to the HKD$52.00 level thereafter in the resistance zone of HKD$50.80-52.00, confluent with a previous swing high formed in January 2022 and the uptrend channel resistance by taking the height of the consolidation triangle (HKD$6.65) projected onto the breakout point.

 

*Expected timeline of the trade is 13 weeks from the date of report issuance.

 

CHART LEGEND

 

Red box = Resistance zone

Green box = Support zone

About the author

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Zane Aw
Technical Analyst
PSR

I analyze the stock market and conduct technical analysis to provide investment recommendations. I look forward to having a conversation with you in our in-house seminars and presentations to identify good risk-reward trading strategies together. I graduated from Nanyang Technological University with a Bachelor of Accountancy (Honours).

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