Victoria Oil and Gas (LSE:VOG) shares are not worth having
until the condition below is fulfilled. What is happening right now is an abortive
rally in the context of a weak market. In spite of the bull’s despondency, the shares would continue to fall
lower. This is only one of the numerous bear markets earth wide.
Technical Forecast
The price chart
of Victoria Oil and Gas shows that the long-term bias on this market is bearish.
This bias is intact, and no long position is recommended right now. Technically,
2 parallel Trendlines and the 14-period Relative Strength Index are used. In
the most part of October 2012, the market was in some equilibrium phase, with no
clear direction (as indicated by the Trendlines). Towards the end of October,
the price broke the lower Trendline and closed below it. Since then, the price
has trended lower. We can also see that the RSI 14 is also below the level 50. This
is a confirmation of a weak market! The RSI 14 has gone into the oversold level
this month, i.e. below the levels 30 and 20. No wonder, the current rally
attempt is just a negligible pullback in the market. The shares are not worth
having until this bearish trend is conspicuously over. There are many ways of
knowing when the bearish phase is over. One of them is when the RSI 14 period
crosses the level 50 to the upside, but another factor must be used to confirm
this.
The market closed
at 2.15. There are potent resistance lines at 2.50 and 3.00; whereas there are
weak support lines at 1.50 and 1.00. Rapid, strong market pressure is
invariably an omen of rally or pullback since somebody is not prone to be
patient enough to add or deduct from significant orders. That person would
definitely move the markets. One method of measuring the pressure on the price
is to consider closing prices. If certain smart money is not satisfied with the
shorting or buying of big positions in a trading period, you would perceive serious
southward or northward biases at closing prices. It is safe to conclude that
downward or upwards attempts would resume the following trading period, especially
with high volume. This would make the instrument in question move seriously in
the near-term.
Conclusion: Always remember to stay calm in the markets –
breathing easily. No matter what a market does, peace comes from the fact that
your safety plan is in place. Markets will forever trend and consolidate
alternatively. Sometimes, they trend upwards, sometimes downwards. Victoria Oil
and Gas stock would rally protractedly one day (but not in the near-term). There
will never be an everlasting trend. Trade only what you see: Buy wen the market
is going up only, and sell when it is going down. The market does not care
about you. Simply keep on doing what is logical and rational.
This article is ended with the quote below:
“…Some novice traders are afraid to
acknowledge their limitations. They believe that admitting their limitations is
like saying they have low self-confidence. They create a false sense of
self-confidence to quell their inadequacy, believing that they can trade under
market conditions that they can't possibly know how to trade.” – Joe Ross
NB: You would be exposed to
world-class, cutting-edge, and top-notch trading experiences here: www.advfn.com
Azeez Mustapha
Market Analyst, Trading Signals Provider and Coach
Copyright (C) ADVFN PLC
For more articles, go to: http://www.advfn.com/newspaper/authors/azeez-mustapha
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