Yangzijiang (SGX: BS6) has experienced a series of bullish recovery since August 2019. However, based on the weakening momentum shown on the chart, possible downside is to be expected:

• The stock had a strong sell down in January 2020 after price broke the lower bound of the rising wedge and closed at $0.92.
• Bearish flag formation suggests downtrend in the near term.
• Candlestick price action indicates a weakening bullish sentiment, with the formation of the evening star formation capped by the 50.0% of the Fibonacci retracement level as its resistance.
• The evening star formation closed below the middle-term 50 SMA price levels.
• Presence of a strong bearish candle is attempting to break the lower bound the of flag which could fuel downward pressure.
• The death cross remains valid as prices trend below the 200 SMA.
• Stochastic is showing an overbought crossover, which indicates a possible end to the recent bullish momentum.

*Timeline of the trade should be between 1-3 weeks from the date issued.

CHART LEGENDS

Red dotted line = 200 SMA

Blue dotted line = 50 SMA