FCPO - Are he Bears Faking It ? - 7/14/2014

The selling continues for most part of past week. Price remains below the bottom band. The MACD is negative again and falling and so is the Stochastic . It has now entered below the 20's signal line. But I am reluctant to call this oversold as the ADX is above 20's and rising. I would only call it oversold if the ADX goes flat again. The DMI is negative but both the D+ and D- are both falling. This would mean both the buyers and sellers are NOT what they appear to be. So with this, I would begin to shift my stop to the prior day high as I begin to think the selling may be getting to an end. My thinking is been supported by the MACD which is not doing a lower trough when price is getting lower.
 
The weekly chart is solidly siding with the bear. Price is below the bottom band. The MACD is negative and below its zero signal line. The Stochastic is stuck inside the oversold zone. The DMI remains negative with the D- going above 30's which mean the selling is strong. The ADX has begun to rise which may mean a new trend in formation. For any reversal to happen, we must first have the price closing back above the bottom band. Otherwise this is a bear dominated market.
As mentioned here last week, I am still harboring some vague thought that the bear may be faking it as there are subtle divergences begin to show at both the daily and weekly chart. But as I said: this does not mean one should start buying now, we need to see some upside retracement first.