I have chosen to check the chart of FKP Property Group this week. I do not at present own shares in this company, but consider that from a technical analysis viewpoint, market sentiment is now more positive, after two and a half years of decline from a high of $4.76 the week ending 08/04/11 to a low of $1.05 the week of 21/06/13.

The weekly chart shows a double bottom formation over the past 8 months.

Share price rallies in the past month of trading

The share-price has rallied since the low of $1.05 on Friday June 21, 2013, following an impulsive move lower from $1.67 on Tuesday April 30, 2013.

It quickly reached the 50% retracement zone, and in the past two and a half weeks has traded in a range between $1.30 and $1.40 approximately.

Today (Tuesday July 23, 2013) the share-price jumped 5.5 cents to a close of $1.435, only just above the 61.8% retracement level.

It should be pointed out that the long-standing down-trend on the weekly chart remains intact at this time.

Chartists would be looking to see a higher high above the 100% retracement level at $1.67 before being optimistic that the trend was reversing.

Traders looking to take long positions now should consider setting a stop/loss position at about $1.30.

Conclusion

The weekly chart appearance of a double bottom formation followed by a strong impulsive move of 35 cents higher. This raises expectation of further gains. This may well be of the order of 35 cents to $1.67 from $1.32.

This target may well be attained by the end of the year given the strength of the first move. 

Disclaimer

This is my opinion based on technical analysis considerations only. It is not a recommendation to either buy or sell shares in FKP Property Group.

Related articles

• Grady takes charge at FKP as Lee departs (thempreport.com.au)

Categories: Chart Analyses, Technical Analysis, Trading opinion

Tags: Fibonacci retracement, Market sentiment, Technical analysis