NST in Depth 30/01/2016.

Is NST a leading stock in our market ?

It was probably the leader and the strongest until the price action behaviour yesterday.

I am keeping the analysis simple so that every reader with minimal understanding of TA can understand it.  MONTHLY CHART  first, followed by DAILY.

An UP TRENDING CHANNEL which has been in effect since 2014, it’s boundaries marked with dashed Green/Lime trend lines.

In ORANGE, we see the first RALLY ( shown with solid thick Orange colour) and it’s REACTION ( correction/pullback/back up) in dashed Orange colour marking the first LEG. Second LEG, RALLY and REACTION in BLUE and the THIRD in PINK with similar fashion.

Q. What to expect when we test the RESISTANCE LINE ( SUPPLY LINE/OVERBOUGHT LINE) of  any UP TRENDING CHANNEL, not just this one with NST ? 

A. Some sort of a SUPPLY to re surface. Is this what happened with NST ? My answer would be, yes. A new intra month HIGH at or near RESISTANCE, what other reaction can I expect, other than cashing in at least partial profits ?  

What day did NST make a new HIGH ? According to my Charting software it was on the 21st.There are some trading systems, buying what may be seen as strength. Like an instrument making a 12 month high. That buying did hold NST up for few extra days and now pulling back/correcting/backing up.

I must stress that the LAST REACTION is the LARGEST, if compared with the prior two suggesting caution, just in case. AS LONG AS NST RESPECTS THE BOUNDARIES OF THIS UP TRENDING CHANNEL IT’S MAJOR TREND IS UP. If  and when the SUPPORT/DEMAND LINE ( bottom dashed GREEN DIAGONAL LINE) of this  TREND CHANNEL is VIOLATED, that would suggest a HALT to the MAJOR UPTREND requiring re-assessment of the situation.

When a MAJOR TREND is UP, PULLBACKS/BACK UPS may be utilised as a low risk entry on a REVERSAL in TA.

MONTHLY NST CHART BELOW.

nstmonthly30012016

In DAILY TIME FRAME a BEARISH BAR on high volume, suggesting potential STOP to the SHORT TERM UPTREND which may be followed by further pullback/correction. Any attempted short term DAILY RALLY is likely to encounter resistance in the zone of $3.25-3.40 suggesting a potential RANGE BOUNG PRICE ACTION BEHAVIOUR  over th coming days/weeks.

I want to see where this decline stops first and then asses it further.

Daily NST CHART below.

nstdaily30012016

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