Fosters at a potential bullish turning point

After the week that the markets have seen globally it’s nice to talk about something looking potentially bullish. Today that stock is Fosters (FGL). I should say from the outset that this is quite a preliminary look at the chart because we still need a new trough to form before most traders would get more bullish but I would say that it’s worth adding to your watchlist.

What you can see occuring here are a few different technical signal that may combine into a bullish reversal. The thing that the trader may have going for them here is that if you see a trough forming at these levels it will likely allow for a nice close stop loss placement which is something that we all like to have.

– the first factor that you would notice is probably the most minor and that is the tweezer formation that the chart has formed where the low tails of the last 2 candles found their low at the same level. This isn’t the most reliable reversal signal but I have found it to be useful if it corresponds with another technical item at a similar level which is what we have in this case;

– second you have the potential for a double-bottom to have formed. Traditionally this is not confirmed until the price moves beyond the previous peak which in this case is $5.89. If the trader takes a long position based on that signal then the initial profit target will generally be the distance between the low of the double bottom and the high – similar to the way in which you would measure a rectangle formation.

– thirdly is the bullish divergence on the RSI. This is something that traders will often look for when looking for momentum shifts at turning points.

As I say, this one is worth a place on your watchlist to see exactly which way the momentum shift in the next few sessions and indeed whether a recovery in price can occur.

All the best,


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