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We'll start this review with a look at the daily chart. My last blog entry suggested there could be bounce off that RSI trendline support. Indeed there was but it was very short-lived. Since then, as can be seen in the highlighted area, the RSI broke through the trendline and has backtested and dropped confirming the break. This is not good unless it quickly breaks back and holds.

One thing to look out for is Friday's inside bar (highlighted) though the range is very wide on that so it's risky to trade.

The day of the RSI backtest also saw the price drop through, and close below, 2 trendline supports. In fact, that RSI support shown belongs not to either of those price trendlines, but to the trendline lower down from the 2009 lows as we'll see on the following weekly chart as we look towards where this could go.
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Unsurprisingly, the weekly chart looks very weak after such a bad week. We can see the price trendline at 14.77p - this is the trendline which the RSI came from on the daily chart and we can see that, also unsurprisingly, the weekly RSI has also broken. This suggests to me that the price trendline will go at some point.

In fact, 30p has now formed a double top on the weekly chart with an intervening low of 18p which gives a target at the major 6p support level and this is now my target. I do expect a bounce off the 15p area due to the trendline, but probably only until the weekly charts backtests its own RSI trendline break.

The rise from 12.5p to 30p looked at the time to have been forming a cup and handle but with hindsight it looks now like it was a 3 wave corrective move. Easy said now, of course, but as previously stated it was critical to have a close above 30p to confirm further upside and clearly that didn't happen.

It's been a harsh lesson in the importance of waiting for confirmation, selling major resistance and how it's sometimes better to wait and buy in at higher prices after an important resistance has been taken out.

There might be a bounce at 15p (the trendline) but I'll be staying out now until that 6p area or it goes above 30p as before. 
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