Amerigo Resources Shows Technical Buy Signal; Special Report by Leading Financial Web Site Penny Stock Detectives

In a recent Penny Stock Detectives article, editor Sasha Cekerevac states that when it comes to researching a penny stock.

New York, NY (prHWY.com) July 30, 2012 - In a recent Penny Stock Detectives article, editor Sasha Cekerevac states that when it comes to researching a penny stock, it is best to look at both the fundamental and technical analysis. Cekerevac notes that for the new investor and the experienced trader, the trendline is a technical analysis indicator to watch for when looking at a penny stock.
"Taking a look at copper and molybdenum penny stock Amerigo Resources, one can see it has good fundamentals and an interesting set-up from a technical analysis point of view for a penny stock," comments Cekerevac.
The company reported an increase in revenue for the first quarter, which ended March 31, 2012, of $50.5 million, as compared to $45.5 million in the previous year, according to Cekerevac.
"The technical analysis indicator to be aware of is the trend, which is drawn or indicated with a trendline. Essentially, this technical analysis indicator looks to inform you of the underlying strength or weakness of a penny stock," explains Cekerevac. "If a penny stock has a lot of sellers that need to unload their shares, they won't simply dump them in the market, as that will make the penny stock price crash. What they do is slowly sell on upticks, but consistently over time."
Looking at Amerigo, this penny stock remained above the negative trendline, observes Cekerevac, which he says signifies that all of the sellers are out of this penny stock, and there will now be more buyers than sellers.
The Penny Stock Detectives editor notes in technical analysis, resistance can become support and vice versa. When looking at points to buy a penny stock, Cekerevac suggests looking for two key technical analysis events: 1) when it breaks a trendline (either uptrend or downtrend, the logic is the same); or 2) invest with the trendline until it breaks.
Another point he mentions is the angle of the trendline, or speed of the move in the penny stock.
"The steeper the trendline, the more danger there is of a snap-back move by the penny stock," notes Cekerevac. "A steepening of the trendline after a long period of a trend taking place is usually a sign of capitulation. At this point, the sellers get to the point when they've accelerated their selling and are exhausted. A break above this negative trendline is extremely bullish as this signifies there aren't many sellers left because they've sold all of their shares and are done. With a lack of sellers, the penny stock is free to move up."
Follow the big money with technical analysis when investing in a penny stock and learn where the trendlines are, advises Cekerevac, as this can greatly enhance returns over time.
To see the full article and to learn more about Penny Stock Detectives, visit www.pennystockdetectives.com.

The editors of Penny Stock Detectives believe low-priced stocks, when researched properly, present investors with great opportunities to accumulate wealth and to increase the value of their investment portfolios. You can learn more about Penny Stock Detectives at www.pennystockdetectives.com.

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Tag Words: penny stock, trendline, technical analysis

Categories: Business

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