Purchase Solo Oil Shares

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Solo Oil (LSE:SOLO) shares have shrugged off bearish threats and have started going up. This development is not in isolation (there are other bull markets), because a stock rarely moves in isolation from other stocks. Buying a bullish breakout in this type of market is one way of making money. Ultimately, this would be in conjunction with some other safe trading techniques. Becoming acquainted with the winning trading techniques is worth the effort.

Technical Forecast
The chart representing Solo Oil was in a serious and protracted bearish mode. For this prediction, the Average Directional Movement Index (ADX) period 14 and the Moving Average Convergence Divergence (MACD) default parameters are used. On September 7, 2012, the market reached a bottom at 0.305 and found it impossible to go lower. In this kind of scenario, one would not take a rash action, since one did not know which way the price would go. Since early September, the ADX and the MACD were gradually forming a Convergence Pattern, for the ADX DM+ has been above its DM- counterpart and the MACD histogram is above the zero line as the signal line neared the latter – something that shows a potential bullish reversal. Since last week, the market has broken out in a significant bullish mode, going up by hundreds of points. The ADX 14 is pointing towards the level 40 (showing strong bullish pressure), while the DM+ is clearly above the DM-. The MACD histogram and the signal lines are far above the zero line. The 2 indicators have formed a Bullish Confirmation Pattern. This is a BUY signal, although it does not mean there cannot be a pullback in the price.

The price closed at 0.515 yesterday. The nearest accumulation zones are 0.400 and 0.300. The nearest distribution zones are at 0.600 and 0.700; and are expected to be breached northwards in due course. If any upper supply level (e.g. on a higher time frame) poses an obstacle to the market move when a bullish push is on, the force of that push could breach that supply level and help the price higher. This is also true of a bear market considering demand zones, whereas if another factor establishes the instrument’s tendency, significant bullish and bearish forces may be experienced in the market.

Conclusion: Sometimes, previous market patterns could be an unreliable yardstick for tomorrow’s prognosis. The Solo Oil is journeying towards the north. Though it was formerly a seemingly hopeless stock, it now has a ray of hope.

This article is ended with the quote below:

“…In addition to all the standard mistakes which every experienced trader should know (no stop-losses and so on) there is one mistake that many traders make but is not too well known: Many traders know too much about the fundamentals of the company they trade and therefore they cannot follow their technical trading rules. But the latter determine the risk/reward-ratio and their drawdowns and it is the first priority to control them. If you do not follow technical trading rules you will trade emotionally and that may cost a lot of money.” – Harry Boxer

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