One of the better ways of dealing with smaller companies and by definition, charts associated with these companies is to go for the most “straightforward” situations. These include where it is clear that former resistance has become new support, or where a resumption of a trend has just been seen. For shares of MTI Wireless Edge (LSE: MWE) both such events have been witnesses to start 2015, with the rebound off former 8p October 2013 resistance, as well as a rebound off a line of support from July 2013 at the same level. If we add in extra positives such as significant bullish divergence in the RSI window between the lower December support at 7.87p and October’s 8.34p floor.
What also adds to the constructive picture here at MTI Wireless is also the recovery of the 50 day moving average at 8.98p. The chances now are that we have enough momentum buy triggers in the near term to deliver a “minimum” retest of the former July high of 12p. Overall the 2-3 months target here is seen as being a retest of the former March 2014 15p plus resistance, a zone which ties in with the top of the rising trend channel from mid 2013. At this stage only a weekly close back below 8p would really be seen as being enough to delay the upside argument.
