Indoagri – Close movement to Noble group

Trend: Downtrend , 20ma down, MacD below 0

Support: 2.01 (200ma), 1.92, 1.81

Resistance: 2.16 (20ma), 2.31 (100 & 50ma close)

Observations:
Candlestick – Long white candle with upper shadow only
Histogram –3G is seen. No bullish divergence is seen.
RSI – around 35%. No bullish divergence is seen.
Stochastic – No bearish crossover yet. At around 60%.
Bollinger Band – Trading at mid band.

Conclusion:
The close trading pair with Noble grp is Indoagri. Both of them has similar characteristic in movement. Hencefore, Indoagri no doubt is also testing 20ma. Based on yesterday’s candle, its formation of upper shadow clearly indicates that it is testing 20ma and have not break 20ma yet. Indoagri’s trend still remains as a downtrend despite the sharp rebound for the past few days. The indicators still do indicate that the bullish sentiment still could continue as there are not bearish signs yet. But this upside movement could be capped at 20ma resistance level of 2.16.
Unlike Noble grp, Indoagri’s indicators did not indicate any bullish divergence. Hence, the downtrend momentum is still good. Looking at the support level, one must be wary of the incoming 200ma as it could give a possible support. If Indoagri decides to bounce off from this 200ma, there could be a possibility of a higher low being form. Hence, we have to make a mental note on this level.
If the downtrend does continue, and 200ma break, we could possibly see it reaching 1.92 support level or even 1.81 level. What we are lack right now is a bearish signal in the chart.

What to watch out for this week:
1) Formation of bearish candle which could indicates a lower high formation.
2) If there is no bearish candle, watch for a break of 100ma which could mean the downtrend might have end.
3) If the price does retrace, watch out for 2.01 level which there is a possibility of higher low being formed there.

Trading strategy to adapt right now:
- One can consider establishing short position once a bearish signal is being seen. But have to target at 200ma for first target. If 200ma refuses to crack, it is better to close the short position.
- For those whom still have long position, it may be wise to reduce long positions here as there is a possibility that downtrend could continue.

*Disclaimer applies