First Res had a surge today despite market being down, It broke its mid term downtrend line today and moved up quite nicely. It came as a bit fast so if we’re unable to catch this first up wave then lets wait for either a retracement or when it breaks 1.64 and play a break out trade. Our eventual target would hopefully be 1.785
Our dear wilmar played punk with us, it went below 3.05 but recovered at the end of the day. Currently very near the resistance of 3.12 and our stop loss but if you are more generous then perhaps a stop loss of 3.18 could be possible too. Wilmar on the back on a possible bad results is due to report on 11 Aug so we are hoping that it should going back to 3.30 level. If it does we might take another short at it =)
If you been following us you would know that we been fairly bearish on first Res. The market for the past week has been moving up but we noticed first res hasn’t been moving much but in fact it came down and today it broke its recent support of 1.55 and its below that now. It might come down to 1.50 and it that still don’t hold then 1.45 will be the next target. Our stop loss would be 1.56 or 1.60
Still remember our post on first res previously? It hit our resistance line in the previous chart and dropped but didn’t drop as much =( as we would have hope for it to so and broke up instead. So if you have placed your stop loss at the resistance line ur loss would have been minimal.
Now for an update , it has come up to the longer term downtrend line and once again if you believe in the pattern you would hope for it to start coming down. Like us we are watching to short as it as reached the resistance. Our stop loss would be at $2.04.
Lets take a look at this stock called first res. Judging by its pattern , we can see that there is a pattern forming whenever it hits that downtrend line that we drawn it seems to come down and rebound back at the lower channel.
As of now, it seems that it has hit that upper trendline channel at about $1.77, whats next for this stock? Well, if you believe in the patterns then u might say that it might start to come down which we hope so too. =) so if we were to short we would short at about $1.77 and have a tight stop loss of about $1.78-1.795. In this case our risk reward ratio would be a good one if we target $1.62 for our downside target. That works out to about a 5 times risk reward ratio . We risk about 3 cents to try to gain about 15 cents of profit. =) A worthy trade we feel.