Refer to the previous post on 4th August 2019:
On the previous post, I proposed to keep this stock in the monitoring list and it was not a good time to buy this stock. I did not predict the gap down on 7th August, but the price action and volume analysis suggested that I should wait for the next price action.
From the observation on 2nd August, the stock was unable to hold above RM3.80 and the selling broke the support with a gap down. The gap down with low volume indicated the lack of demands might cause the price to decrease further. On 5th August, the daily price closed 3.48% lower at RM3.60. It was a solid message for me to sit tight and wait for the price to establish the next support. On 7th August, the stock gapped down 9.55% and supported above RM3.08. The huge volume implied the buyers were trying to hold the price above RM3.08.
Should I buy now?
Not yet. Although the huge volume on 7th August suggested strong support, don’t forget it was also a strong gap down. With the recent negative news, I reckon we should wait and monitor the stock. (Click here for the full picture)