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FIBONACCI


Toromont Industries Signal Says Buy

04/25/12 10:25:52 AM
by Koos van der Merwe

A buy signal is given on the vote line. Let us study the charts.

Security:   TIH-T
Position:   Accumulate

Using a program that analyzes more than 2000 securities, Toromont Industries gave me a buy signal. The charts here show why.

FIGURE 1: TOROMONT, DAILY
Graphic provided by: Omnitrader.
 
Figure 1 is a chart showing the vote line that gave me a buy signal based on the RSI 12-period strategy. A look at the chart shows that the price also broke above the trailing stop line, confirming the signal. The relative strength index (RSI) indicator and the Ind ergodic oscillator shown on the chart both gave buy signals. Volume is however light, but it did strengthen as the price rose on the April 18. The chart also shows that the price tested and found support on the 38.2% retracement level. At a price of $22.42, the closing price of April 18, and a possible target of $25.00, the high of March 16, the share truly looks interesting.


FIGURE 2: TOROMONT, DAILY, WITH WAVE COUNT
Graphic provided by: AdvancedGET.
 
Figure 2 shows the Elliot wave count completed the c-wave correction on the 38.2% Fibonacci retracement level. Note that the c-wave was with the fourth wave of lesser degree. The RSI, in this instance a 14 period, has given a buy signal. The price has not given a buy signal on the JM internal band indicator by breaking above the upper band.

The XTL parameter that changes the color of the candlesticks uses a statistical evaluation of the market and tells the difference between market noise and trends. At the moment the bars are red, which means that a buy signal has not yet been given.

Figure 1 is giving a buy signal. Figure 2, even though the Elliott wave count is complete and follows the first rule, namely the count must look right, has not yet given a buy signal. Traders could therefore buy at present levels. Investors could wait for a break above the upper JM internal band line, or a change in color of the candlestick price. Definitely a share to watch.




Koos van der Merwe

Has been a technical analyst since 1969, and has worked as a futures and options trader with First Financial Futures in Johannesburg, South Africa.

Address: 3256 West 24th Ave
Vancouver, BC
Phone # for sales: 6042634214
E-mail address: petroosp@gmail.com

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