Ferro China 050908

After testing the 0.890 support (lightblue ...) and the 1st long term downtrend support (mid pink) on 2 sep, Ferro China finally broke both of them yesterday (4 sep).

We could eventually see FerroChina hitting the 0.700 level before there's any chance of a rebound.

Ferro China formed a double-top - with 1st top around early may, and the 2nd top at the beginning of aug. If we take the neckline to be 1.26, we're looking at 0.78 to be the support (1.74 - 1.26 = 0.48 then 1.26 - 0.48 = 0.78), which we have hit today (blue --).

If Ferro China breaks the 0.78 support as well, the next support could go as low as 0.540, which is the difference between the 1.14 neckline (red ...) and the peak (1.74 - 1.14 = 0.60 then 1.14 - 0.60 = 0.540).

Although FerroChina is now trading within the downtrend channel (red), we could still see some form of rebound when it hits the 0.700 level.



For monday :

Support @ 0.780 (blue --), 0.745 (low red), 0.725 (low pink)
Resistance @ 0.817 (upp red), 0.841 (mid pink), 0.890 (lightblue ...)