One of the simplest and more effective charting rules is that when a stock or market is below the 200 day moving average we can regard it as being bearish, and a sell into strength, whereas above the 200 day line the Bulls are regarded as being in a position of dominance.
This is essentially what we are seeing in terms of Silence Therapeutics PLC (LON:SLN) on the daily chart over the near-term, but with the transition from bearish to bullish somewhat blurred in terms of an extended January/February break above the key trend determining chart feature.
But at least it can be seen how overall since the middle of October when there was a selling climax towards £1.60, we have been treated to a reasonable progression to the upside within a rising trend channel from the autumn. The floor of the channel currently runs at £2.30 which is level with the 50 day moving average, and this is regarded as the near-term stop loss for those close to the market on this stock.
Otherwise the message is that while there is no end of day close back below the 200 day moving average of 217p, especially while the RSI now at 53 remains above neutral 50, we can look to Silence Therapeutics heating the October rising trend channel top at 300p as soon as the end of April.
