A little like Kumba S32 is looking week in a strong sector. The relative strength to the resources sector is rolling over. I previously looked at the structure as accumulation but this seems to have been an upthrust (UT) that met with supply (Increased volume on UT). The volatility to the downside has increased from 19 to 28 to 34%. The upward stride has been broken and is being retested. This looks weak and probably is distribution. The recent rally was without any conviction, even though it was over the holiday period.
Comment:
After an attempt to rally we have seen a smaller distribution TR that is probably a last point of supply (LPSY). The break of the smaller TR could be tested before the markdown begins that will push the price below the larger TR. In the smaller TR, we have seen selling pressure that has now overcome the buyers.
Comment:
S32 is ready to start the markdown. The relative strength and RSI are declining and a break of the trading range will see the markdown in phase E start.
