Since XD on 9th Dec 08 with a dividend of $0.19/share, the price of SPH has fallen from $3.60 ( closing price of 5th Dec 08 ) to an intra-day low of $3.14 on 12th Dec 08, 1cents above the intra-day low of $3.13 on 28th Oct 08. Looking at the candlestick, a 3 black crows was formed on 9th, 10th and 11th Dec 08. A doji closed on 12th Dec 08 could signify a possible trend reversal on the way. The DI- though has cut up due to the 4 days of heavy selling but the ADX signal has dropped to the 20 level indicating further downside is lacking in strength and a possibility that a double bottom formation has formed. RSI hit the 30% level, on the brink of entering oversold region and Stochastic signal just landed below the 20% level into the oversold region. However, the Stochastic signal starts to show a sign of turning flattish. This could be the start of forming a base around the $3.20 region. An immediate rebound might not be on the way and possible of doing base building in the next few trading sessions. This will cause the price to move sideway during these sessions and eventually both Stochastic and RSI signals will turn flattish to indicate the forming of the base. Looking at the time frame from now till end of the year, with a possible 1 week to form the base, it is possible that if there is a year end rally, it will be just in time to rally up from the base. The first level of resistance will be the $3.40 level; this was the base it built prior a rally up to $3.65 before XD. A rally up to $3.60 would be a bonus and if gap filling is possible during year end rally, potential upside of $3.80 is there. Meanwhile, if it is building a base now, the downside would be limited to the $3.13/$3.14 level. If a very bearish sentiment occurs due to extremely bad news, the price might sink to test the $3.00 level. SPH is renounced for its defensive play and slow price movement. This could a stock f0r those who is risk adverse and hoping to catch a bottom and hold about 2.5 week for the year end rally.
