Technical Pulse: Japfa Ltd January 25, 2018 980


Japfa Ltd – Daily timeframe (Update from 27 October 2017)

25 jan

*Entry Price: 0.535                             Stop loss : 0.455                   Take profit : 0.615

Current Sentiment: Bullish

Support 1: 0.485                   Resistance 1: 0.575

Support 2: 0.460                   Resistance 2: 0.615

Due to the lack of bullish follow through after the last update, price fell back into the long-term downtrend. The 20 and 60 day moving average continued to weight down on price since 08/11/17 after the 20 day moving average crossed back below the 60 day moving average.

The bearish momentum resulted in price breaking yet another new 52-week low in December 2017 at 0.460. However, that appears to be a false breakout as the bulls hurriedly move price back above the 0.485 support area on 22/12/17. Since then, price has stayed above the 0.485 support area showing some sign of strength.

Moreover, after much consolidation between the tight range of 0.505 range high and 0.495 range low, some sign of life appeared. There was a strong bullish breakout above the 0.505 range high on 24/01/18 with increasing volume signals a possible reversal higher. In addition, the bullish rejection off the 0.495 range low succeeded in forming a Bullish Engulfing Bar that also broke above the 60 day moving average suggests increasing bullish momentum.

Watch for the bullish follow through to occur for price to put in a near-term bottom at the December low of 0.460. For this reversal, price should be aiming for the 0.575 resistance area next followed by 0.615.

25 jann

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About the author

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Jeremy Ng
Research Analyst
Phillip Securities Research Pte Ltd

Jeremy specialises in Technical Analysis and has 10 years of experience in studying price action. His areas of expertise include intermarket analysis on the equities, currencies, commodities and bonds market.

He is also a regular columnist on The Business Times - every Monday ChartPoint column.

He graduated with a Bachelor of Science in Banking and Finance from University of London.

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