Wednesday, October 29, 2008
Cheap Sales (1): Banks
Dropping from a cliff. Next possible support is at 5000.
Uptrend line broken. Possible supports: 1.80, 1.30.
Approaching its last uptrend line.
Uptrend line broken. Only starting to break down. Possible supports: 4.00, 3.00.
At possible support point of 5.00. Next are 3.50 and 2.50.
Resting on its uptrend line. Next possible support is around 6.50 to 7.00. Technically, this is the strongest among the banks.
Resting at its uptrend line.
Based on the monthly chart's RSI reading, it seems that all the banks can fall some more because the monthly RSI is not oversold yet. In the 1997 crisis, the RSI managed to go under 30 before the prices recover. You can also notice that a bottom takes about 6-12 months to form. So don't worry that you have missed it. It is best to pay 10% more for a sure bottom than catching a falling knife.