Looking for stocks with high potential, I found another one following Maanshan Iron&Steel I posted yesterday. However, as I still have not much confidence on the whole market, my focus will still be large-cap stocks which are highly defensive.
Above is the daily chart of New World Development (0017.HK). As we all know, the company's primary functionality is property development in both Hong Kong and PRC.
From its background, we could find great potential for high earnings because of the never-stop-surging property prices and the harmless-to-property policies imposed by the government.
Anyway, let's go back to technical analysis. I have drawn three trendlines in total: two down-trend and one up-trend.
The red down-trend line is a longer one, the price is still under this trend-line and I expect the BUY signal would be the breakout of this line.
The purple down-trend line is medium-term, NWD broke this line few days ago and showed a strong bullish trend here, together with the rising MACD.
The green up-trend line is a very short-term line but a strong one, as it has successfully supported the price three times.
Purple and green lines form a small pennant. This pennant has only been formed for around a month, so of course it is not that strong compared with the pennant for Maanshan Iron&Steel. However, breakout of this pennant would somehow give some power to the stock to break the red down-trend line as well.
Resistance is at 14.4, and if NWD breaks this level, we could buy and hold this stock.
No comments:
Post a Comment