Rex International (SGX: 5WH) recovery has been progressing strongly with prices breaking the $0.150 psychological level in mid-May. However, Rex international does face some resistance at $0.200 region and based on the technicals, the stock is making another upside rally:
- After the stock exhibited some selling at $0.200, the stock managed to stay above $0.170, which forms into a potential bullish pennant/symmetrical triangle.
- Combining the resistance level 1 at $0.188 with the lower upslope trend line of the pennant, it forms an ascending triangle within the pennant formation.
- Bullish harami formation indicates a weakness in the selling after a strong bearish engulfing candle on Tuesday.
- The stock is still trending well above the immediate uptrend line and the 50 and 200-day moving averages. To add on, the golden cross formation in mid-June 2020 signal a strong confirmation of a bullish trend.
- Perhaps the most wholesome pattern to signal a continuation of the upside is the rounding bottom. Should price breaks the pennant top, this signals a complete formation of a cup and handle formation.
*Timeline of the trade should be between 1-3 weeks from the date issued.
*Should price reverse lower below 0.170, the stock is likely to find the next support zone at $0.150-$0.149
CHART LEGENDS
Moving average
Red dotted line = 200 periods Moving average
Blue dotted line = 50 periods Moving average