Chartists Placing Chunghwa Telecom Co Ltd (CHT) Under Scrutiny

Chunghwa Telecom Co Ltd (CHT) touched its lower 7-day moving average bollinger band.  Investors will be paying close attention to the shares to see if they will experience a bounce off the bottom or continue the downward near-term trend.

Developed by technical analyst John Bollinger in the 1980s, Bollinger Bands identify the degree of real-time volatility for a currency pair. Traders keep a close eye on volatility because a sudden increase in volatility levels is often the prelude to a market trend reversal. Bollinger Bands are placed over a price chart and consist of a moving average together with upper and lower bands that define pricing “channels”.

The initial bottom of this formation tends to have substantial volume and a sharp price pullback that closes outside of the lower bollinger band. These types of moves typically lead to what is called an “automatic rally.” The high of the automatic rally tends to serve as the first level of resistance in the base building process that occurs before the stock moves higher.Digging deeper into other technical data, {Chunghwa Telecom Co Ltd (CHT) has a current 14 day Williams %R reading of -92.16. Levels can range from 0 to -100. A Williams %R that falls between -80 to -100 is typically viewed as being in strong oversold territory. A value between 0 to -20 would represent a strong overbought condition. As a momentum indicator, the Williams R% has the ability to be used with other technicals to help define a specific trend.

Chunghwa Telecom Co Ltd (CHT) presently has a 14-day Commodity Channel Index (CCI) of -99.21. Typically, the CCI oscillates above and below a zero line. Normal oscillations tend to stay in the range of -100 to +100. A CCI reading of +100 may represent overbought conditions, while readings near -100 may indicate oversold territory. Although the CCI indicator was developed for commodities, it has become a popular tool for equity evaluation as well. Checking on another technical indicator, the 14-day RSI is currently sitting at 37.41 and the 7-day rests at 31.43.

The Relative Strength Index (RSI) is a highly popular technical indicator. The RSI is computed base on the speed and direction of a stock’s price movement. The RSI is considered to be an internal strength indicator, not to be confused with relative strength which is compared to other stocks and indices. The RSI value will always move between 0 and 100. One of the most popular time frames using RSI is the 14-day.

Moving average indicators are commonly tracked by technical stock analysts. Many traders will use a combination of moving averages with multiple time periods to help spot stock trend direction. One of the more popular combinations is to use the 50-day and 200-day moving averages. Investors may use the 200-day MA to help smooth out the data a get a clearer long-term picture. They may look to the 50-day or 20-day to get a better grasp of what is going on with the stock in the near-term. Presently, the 200-day moving average is at 33.92, and the 50-day is 34.15. The 14-day ADX for Chunghwa Telecom Co Ltd (CHT) is standing at 22.97. Many chart analysts believe that an ADX reading over 25 would suggest a strong trend. A reading under 20 would suggest no trend, and a reading from 20-25 would suggest that there is no clear trend signal.