Zone trading and CSL

This post updates one  written on April 26, 2018 that was bullish for its prospects.

https://technicality.me/2018/04/26/csl-limited/

Some six months later, the 12 month daily candlestick chart shows that the optimism expressed was well justified. with the share-price not only reaching the suggested $200, but exceeding it to reach a high of $232.23 on 3 September 2018.

CSL Nov 18

It would in retrospect have been ideal to have exited at about this level, but realistically from a technical viewpoint, a more prudent exit signal was given on the 6th September when there was a $10 fall in the share-price to $217.16 causing the Parabolic Indicator to switch from an upwards to a downwards trajectory.

As is often the case, a large range fall in the share-price in the wake of a sustained uptrend is often a harbinger of further falls. The further chart of CSL 5/11/2018 adds a Fibonacci retracement trace, showing retracement to the 61.8% Fibonacci level at $175 before rebounding.

CSL Nov 18 b

Investors with an interest in Technical Analysis will note that today’s negative candlestick appears to be a turning point from $192 forming a lower high, with the possibility of further falls.

For a majority of the past year CSL has traded in Zone 3 between $167.80 and $200. My assumption is that in the absence of further sensitive news releases, this is likely to continue.

A scenario which I would find most bullish would be a rebound off support at $167.80 which broke out above $200 into Zone 4.

Readers of this post are reminded to always seek guidance from their stock-broker or other qualified financial adviser, and to not rely on Technical Analysis alone.

 

 

 

 

 

Since writing this post, the share-price made a lower low and fallen to just below $185. Further declines are possible.


Categories: Chart Analyses, Trading opinion

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