AMP has seen a dramatic fall in the share price over the last 12 months. This time last year it was at $5.40. In late October we saw large volume, climatic action and ultimately stopping action at $2.28. The stock rallied to $2.77 which formed the parameters of our trend channel. Notice when the stock tested the $2.28 level in November and December, there was very little volume. It appears a lot of the supply was taken out of the market with the climatic action previously. This was a transfer of the stock from weak hands to strong hands.
Throughout February we fell down lower than the bottom of the trend channel and formed two springs - notice the volume increased. Think of the psychology at this level, if there were any weak hands holding on at this level, the push lower and the fear of further falls would have had them closing their positions. The stock tried to rally at this point but the volume wasn't overly great, showing that there would be some retesting. On the 27th February the stock pushed down lower on very little volume, indicating supply was drying up.
We are now at an interesting place on the chart, do we start Phase D of Wyckoff accumulation and start to move higher, if this is the rally that sees a sign of strength and the top of the trend channel taken out, we need to see nice change in character and demand come into the stock ie. nice wide range up bars on good volume.
Monitoring this one closely...
Throughout February we fell down lower than the bottom of the trend channel and formed two springs - notice the volume increased. Think of the psychology at this level, if there were any weak hands holding on at this level, the push lower and the fear of further falls would have had them closing their positions. The stock tried to rally at this point but the volume wasn't overly great, showing that there would be some retesting. On the 27th February the stock pushed down lower on very little volume, indicating supply was drying up.
We are now at an interesting place on the chart, do we start Phase D of Wyckoff accumulation and start to move higher, if this is the rally that sees a sign of strength and the top of the trend channel taken out, we need to see nice change in character and demand come into the stock ie. nice wide range up bars on good volume.
Monitoring this one closely...