Technical Pulse: Meituan Dianping October 28, 2020 561

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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About the author

Profile photo of Chua Wei Ren

Chua Wei Ren
Technical Analyst
Phillip Securities Research Pte Ltd

Wei Ren specialises in Technical Analysis and has 11 years of experience in studying classic technical price action. He also study and research extensively on Elliott wave theory, Dow Theory. He believes that history plays an important role in how the market is reflected in the future.

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