Pinehill Pacific bhd (Rm 0.50) - Part III

Assuming Pinepac has bottomed at 14 sens last week and it has started its new uptrend cycle.

Today is the 4th day of its new cycle. The 69 sens high marked the end of its mini wave 1. From the 5-minute interval chart, it appeared to me that Pinepac is possibly forming the wave b of its mini wave 2. 

 

It is good to take note that besides the possibility of a simple a-b-c wave form for the mini wave 2, there are other possible forms such as a-b-c-d-e or a-b-c-x-a-b-c and so on. 

For stocks that have been moving downtrend with thin volume for years and then suddenly became very active with high volume, I usually disregard its past OBV figures and start a new OBV computation to monitor the accumulation/distribution.

From the table, beside the OBV, I have added a column for 'cumulative volume' that is for me to check the velocity of Pinepac. The velocity is defined as the number of times Pinepac turns its capitalization of 150 million shares. The cumulative volume is expressed as a percentage of the capitalization. By the close of today's trading the velocity has reached 40.66% of its capitalization and the OBV has reached 21.54% of its capitalization.

Due to the activities of day-trader and short term speculators, it is possible that velocity may reach a few hundred percents (having turned over the capitalization a few times).

Daily volume is expected to shrink during consolidation until the next run up.

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