China HongXing - Breakout to North or to South?

China HongXing has formed a Head & Shoulders and at the edge of breaking out from a triangle. If China HongXing breakout from the triangle and go north with huge volume, the stock may go up to $0.27. Conversely, if the stock breaks out (the triangle support is also the neckline) and heads south, the stock may go down to $0.13.

China HongXing - Broke all critical support levels!

China HongXing closed at $0.20 with another bearish marubozu candle today! It also broke the uptrend channel support, 50D MA, and short term critical 61.8% Fibonacci retracement level of $0.204. All other technical indicators show weakness of the stock price. It may face further sell down pressure because the stock price is at the bottom envelope of the Bollinger Band and also below the Parabolic SAR line. It will be critical to see whether China HongXing can bounce back from $0.20 to $0.205 level in the next few days.  The next critical support level at $0.17 to $0.18.

China HongXing - Swinging in the channel?

China HongXing demonstrated a similar trend like Synear. Today the stock closed at $0.25 with a gravestone doji (end of the short term up trend) where the bear tried to push the price back to the channel. If the stock price returns to the channel and starts the retracement,  I will target to enter the trade at $0.21 and exit at $0.26 with a profit target of 24% within a two weeks trade.

Don't chase the price!

A lesson I've learnt recently is not to chase the price no matter what the technical indicators showed. I chased the price of Hongguo at $0.34 (at the top) when I saw all Standard Six indicators showed bullish convergence, however the price retraced back to $0.27 within one week. Currently I am still at lost with Hongguo's $0.31 today with thin trading volume. I will probably hold the stock for a longer term and wait to reach the my calculated intrinsic value of $0.85 (calculated before the recent Q2 2009 financil result).

The hardest part of the stock trading is to control the emotion, however I was able to control my emotion by delaying the action by one part after seeing Synear breakout from its triangle. I was very tempted to enter the trade at $0.285 but I kept reminding myself not to chase the price. Eventually I was able to enter at $0.275 and today Synear closed at $0.305, a handsomely 9% paper gain in one day!

Today I almost go to chase China HongXing stock price at $0.215 before the market close. Fortunately I was disciplined enough to wait for another day. Base on the candle sticks, the stock price failed to break the resistance and would probably retrace back to between $0.18 to $0.20. This gave me another opportunity to buy on a dip.

Lesson Learnt: It is OK to make mistakes but must learn how to prevent making the same mistake for the second time.

China HongXing - trying to break strong resistance of $0.215

Another hot China stocks trying to breakout from the strong resistance with increasing volume.


Resistance at $0.215. If the stock price break the resistance, it may go up to $0.268 (161.8% Fibonacci). The next strong support at $0.183 (61.8% Fibonacci retracement) and $0.156.

PE = 6.8
Dividend Yield = 1.25%
NAV = $0.3359

Base on Q2 2009 result:
Current Ratio = 25
Cash = $520 Million
Net Earning = 9.5%
ROA = 10.1% (2008 Full Year)
ROE = 11.6% (2008 Full Year)
3 Years Historical High = $1.42
Current Price = $0.215