With reference to a post on 12th Jan 09 on ST Engg about it being traded in an ascending triangle formation. At 16th 09 close price of $2.39 and tested the resistance level of $2.58 several times within the week, ST Engg is now in a do or break mode. A breakdown at $2.36 price level would invalidate the ascending triangle formation and pull back to next support level at $2.28. The Stochastic signal has cut down and head towards the 50% level and RSI too heading down towards the 50% level. If the $2.36 level still able to hold for the coming few sessions, it should be able to re-test the $2.58 resistance level again. To breakout from the ascending triangle at $2.58 level, the DI pair must be able to be positive spaced with ADX signal moving up towards the 40 level.
Investors holding long position and awaiting for the breakout of the ascending triangle formation should maintain cautious on the $2.36 price level. A breakdown should cut loss.
