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CHP is dropping


By: Marvin Germo | August 21, 2017

The stock has fallen, dropped and has been battered several times after the breakdown sell signal last February 2017. From that time I have received a lot of messages with regards to its status and where it could possibly go. I hope this post would shed further insight should you buy or avoid the stock as of now.

Since it’s IPO I wasn’t really a fan of CHP as its proceeds went pretty much to debt repayment. Coupled by disappointing earnings results and more disappointing earnings results and the fact that we really don’t have a catalyst to make the stock go higher makes the stock not so interesting at this point in time. Will it be like this forever? Well time will tell if it can produce game changing earnings and it can ride the infrastructure push that will happen. With that, I still favor its competitors HLCM and EAGLE as compared to CHP as of this point. Also there are other stocks in other industries like ALI, SMPH, JFC, EW, PGOLD, BDO, etc,  that would be better long term plays than CHP.

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From a technical analysis point of view, the stock is still pretty much bearish and a bearish stock would continue to go down until the downtrend lines would get broken or it breaks out from significant resistance levels. As of this point we don’t see that happening yet. CHP won’t go up and turn bullish until it breaks out of 8.8, which stands to be its strongest resistance.

However for that to happen, it must breakout of three other resistances first, 6.60, 7 and 7.65. Until that happens we really can’t expect any significant moves upward or any legitimate reversals in the stock.

For traders who want to make a quick sell from the stock being oversold, you may buy as long as the stock holds above 5.60 and set your target price at 6.60 for a 17.80% trade.

Since the stock is still bearish and we don’t have any strong trend reversal signal yet, please avoid the stock for the moment. I will try to update you once we see evidence of a reversal upward.

CHP will drop

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