PETROFAC Limited - Bullish divergence

A 92% correction from July 2012 (ouch) creating a considerable oversold condition (as if it was not already obvious) there now exists an ‘incredible buy opportunity’ for those brave enough.

Why Bullish?

1) The bears are exhausted - this is indicated by the ‘capitulation’ volume candles. Remember, ‘Extremes in a market is marked by extremes in volume’.

2) Regular bullish divergence between price action and the oscillators is clearly visible on the above 10-day chart.

3) Volume increase + point (2) = very bullish.

4) The most bullish signal of all appears on the 2-month chart below, a Dragonfly DOJI. Those candles are not to be ignored. The further up the time scale the more powerful the signal. Weekly DOJI’s are great, monthly better. 2-month candles are on another level.


2-month chart

Trade active:

9 oscillators showing divergence with price action, price action is ready to pop.

Trade active:

30% up two hours later, which one of you was it? Fess up...

1st target 195

Trade active:

up 40% 140 days later. Bazinga!