Here is some analysis of PNL's daily activity taken from the Technical Analyst, you need to have the 200, 50, 10 days moving average charts handy.
On the latest trading day, PNLK has traded between 3.531 and 3.281, following its open at 3.531. The difference between these two extremes represents a trading range of 7%. 87,500 shares have traded hands so far on this same day. The number of shares which have been traded on this latest trading day represent 8% of its average daily trading activity over the trailing thirty days.
At least one moving average indicator (the 200-day) suggests that this stock technically may have risen too much and/or is too expensive from a longer-term perspective. This does not mean that the stock is about to fall. Actually, it indicates that it still appears to be in a bullish trend. This analysis is based on the fact that the stock price is so far above the 200-day moving average.
Now were you to compare the price line to its 50-day moving average line, you would see that the former is noticeably below the latter. According to the moving average theory, when a stock price moves below its moving average, the end of an advancing trend is signaled. In this case, the moving average indicates a fairly bearish outlook, depending on when the crossover from above to below the moving average line took place.
And finally, consider a much shorter moving average: the 10-day. This last line is well below the price line for PNLK. That being the case, a technician would probably interpret this to mean that though it is in a bearish stage, this stock could be quite oversold, and hence due for a rise, especially if the rate of decline is easing. Remember that moving averages can help you determine if an existing trend is still in place and aid in confirming when a change in trend has occurred. Unfortunately, it will not let you know beforehand that a change is about to take place. Conservative investors often look for a stock price to close above the 200-day moving average as confirmation of a positive trend change before investing money in a stock. A combination of these averages is probably a wise thing to consider. If this is done, remember that the shorter time period moving average line should be above the longer one in order to represent a bullish stance. |
