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The stock price of Red Rock Resources (LSE:RRR) will soon give traders and investors a great opportunity to buy at a very low risk and high reward price. They should start whetting their appetite, because the market would soon resume a long-term journey to the north. The reason behind this would be explained in the analysis below. The more intense the market pressure is, the more speculators react to the market. When the bullish pressure starts in earnest, those dogs who have recently gone short would be forced to smooth their positions at they abscond with their tails between their legs (after there begins a long-term rally).
Technical Forecast
This stock has been trending downwards for a very long period of time, as shown on the chart. 4 EMAs are used for this analysis (you can see the value and the color representing each EMA on the top left side of the chart). The EMA 200 confirms that the market has been weak for a very long time, and this is also supported by other 3 EMAs. In the past, price retracements into the EMA 20 or the EMA 50 gave swing traders excellent opportunities to short the stock. While it is true that sellers would have made good fortune in this market regardless of occasional counter-trend gaps, price spikes and bullish corrections. It is no longer safe to short this market, and it is not advisable to go long at this time. When would it be logical to go long?
The price has found major support zones and would constantly find it difficult to go further south. The price is currently ranging as it is trying to find some acceptance phase. Eventually, a dependable reversal in the market would start as the EMA 20 crosses the EMA 50 to the upside as the price closes above the latter and heads toward the EMA 200. This would be the best time to buy. The stock was at 1.9 as this analysis was being written. The support zones that would impede further bearish threat are 1.8 and 1.7. The resistance zones that would easily be breached ultimately are 2.0 and 3.0.There is no such thing as an everlasting trend in the financial markets. As a result, a reliable strategy is employed since it has good statistical approach that aids in pinpointing accumulation and distribution zones on a chart. This is an aforethought notion: it helps remove subjective and illogical decisions in the market. In addition, knowing when there is a rally makes us get ready to enter the market very cheap as we ride a winner, no matter what the pullbacks in the price portend. We would also do well to consider money management and safety measures.
Conclusion: Ability to scan the historical data has made us to develop a right perspective on Red Rock Resources shares, which is expected to start its northbound journey soon. At times, market analysts and trading experts must look at historical data so as to prognosticate what would happen tomorrow or in the short-term. Historical data and real-time quotes are available at www.advfn.com.
This article is ended with the quote below:
“If the beliefs you have about your capacity to manage uncertainty in trading are effective, the results will be reflected positively in your trading account. The reverse is also true. If the beliefs you bring to the management of uncertainty in trading are not effective, they will produce trading performances that show a capital drain on your trading account.” – Rande Howell
