Technical Pulse: Sunny Optical Technology Group Co Ltd July 30, 2021 248

Sunny Optical (HKEX: 2382) sell-off after reaching the high at HKD$248.00 region was nothing more than a corrective based on the technical indicated. As such, price action indicates a potential break to the upside:

 

  1. The formation of the bullish flag not only is a bullish continuation pattern, but it also symbolise a shortfall throwback retracement.
  2. Candlestick formation on Wednesday and Thursday indicate a bullish consolidation and rebound from key levels. First, the bullish candle on Wednesday shows a strong bearish candle initially but the rebound away from support zone 1 at HKD$203.25-HKD$211.20 and the 63- period moving average indicate a rebound building up. True enough, the inside bar formation on Thursday close above the 22-period moving average further cement the bullish upside.
  3. Short-term bullish crossover is still valid after prices resume trending above all three moving averages.
  4. MACD is pending a crossover to the upside, once the crossover is complete, it will further cement the upside potential.

 

*Timeline of the trade is 15 weeks from the date issued.

 

CHART LEGENDS

 

Moving Average

Red dotted line = 200 Periods Moving Average

Blue dotted line = 63 Periods Moving Average

Green dotted line = 22 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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