Betting on LOTO

This was a long delayed answer to Pat's request. Good news and bad news!

The good news first. 1) The price break free from the downward price channel. The resistance line of the price channel is now serving as our support. 2) The price also breaks the ceiling of the box that has been holding it in condolidation inside the price channel (ceiling is at P10.00). For the bad news, I know you'll see it very obvious. 1) The price went back inside the consolidation box. 2) The previous resistance of the price channel serving as support is in downward bias so the support is dropping.

Checking previous price movements (see blue circle), we can see that a box was formed middle of Aug 2007 and price broke out from the box on the last week of September only to be stopped at the resistance of the price channel. After that, it heads back down.

This time could be different since LOTO is outside the price channel. The most probable scenarios that could happen are 1) Price will head back down and bounce at the price channel line serving as support (this bounce on the line will confirm the strength of the support line. If the line will cross the floor of the box, it is the floor that will be tested first (floor is at P9.00). 2) It will head back up the ceiling and continue forming a new box with a probable resistance at P11.00