Signal Watch: Chaikin Oscillator Under Zero for Pointerra Limited (3DP.AX)

The EU will unveil proposals for a digital tax on US tech giants on Wednesday, reported France 24. The special tax is the latest measure by the 28-nation European Union to levy fees on Silicon Valley giants and could further inflame a trade row pitting the EU against US President Donald Trump. 

As the proposed digital tax would be applied on the basis and geography of digital users, Facebook (FB) would face levies, along with Alphabet’s Google (GOOGL), and Amazon (AMZN), among others. Companies with annual revenue of less than $924 million may not face the new fees. EU Economics Affairs Commissioner Pierre Moscovici will present proposals aimed at recovering billions of euros from mainly US multinationals that shift earnings around Europe to pay lower tax rates. 

The new tax has been championed by French President Emmanuel Macron and will be discussed over dinner at an EU leaders summit on Thursday. The unprecedented tech-tax follows major anti-trust decisions by the EU that have set back Apple, Google and Amazon.

After a recent look, we have noticed that the Chaikin Oscillator is under zero for Pointerra Limited (3DP.AX). Traders may be paying close attention to the stock and looking out for possible bearish momentum.

Looking at the current landscape of the equity market, investors may be doing some bargain hunting for stocks to add to the portfolio. Many sharp investors will welcome temporary market dips which may provide plenty of buying opportunities. Being prepared for these types of opportunities can help the investor make quick decisions in the midst of a downturn. As we move closer to the close of the year, investors will be closely watching the next round of company earnings reports. Even if the individual investor chooses to trade conservatively during earnings, they can still do the necessary research and have stocks lined up to purchase when the time is right.

The Relative Strength Index (RSI) is a momentum oscillator that measures the speed and change of stock price movements. The RSI was developed by J. Welles Wilder, and it oscillates between 0 and 100. Generally, the RSI is considered to be oversold when it falls below 30 and overbought when it heads above 70. RSI can be used to detect general trends as well as finding divergences and failure swings. The 14-day RSI is presently standing at 42.18, the 7-day is 34.31, and the 3-day is resting at 28.81.

We can also take a look at the Average Directional Index or ADX of Pointerra Limited (3DP.AX). The ADX is used to measure trend strength. ADX calculations are made based on the moving average price range expansion over a specified amount of time. ADX is charted as a line with values ranging from 0 to 100. The indicator is non-directional meaning that it gauges trend strength whether the stock price is trending higher or lower. The 14-day ADX sits at 29.13. In general, and ADX value from 0-25 would represent an absent or weak trend. A value of 25-50 would indicate a strong trend. A value of 50-75 would indicate a very strong trend, and a value of 75-100 would signify an extremely strong trend.

Interested investors may be watching the Williams Percent Range or Williams %R. Williams %R is a popular technical indicator created by Larry Williams to help identify overbought and oversold situations. Investors will commonly use Williams %R in conjunction with other trend indicators to help spot possible stock turning points. Pointerra Limited (3DP.AX)’s Williams Percent Range or 14 day Williams %R currently sits at -95.24. In general, if the indicator goes above -20, the stock may be considered overbought. Alternately, if the indicator goes below -80, this may point to the stock being oversold.

Pointerra Limited (3DP.AX) currently has a 14-day Commodity Channel Index (CCI) of -82.61. Active investors may choose to use this technical indicator as a stock evaluation tool. Used as a coincident indicator, the CCI reading above +100 would reflect strong price action which may signal an uptrend. On the flip side, a reading below -100 may signal a downtrend reflecting weak price action. Using the CCI as a leading indicator, technical analysts may use a +100 reading as an overbought signal and a -100 reading as an oversold indicator, suggesting a trend reversal.

Moving averages can help spot trends and price reversals. They may also be used to help find support or resistance levels. Moving averages are considered to be lagging indicators meaning that they confirm trends. A certain stock may be considered to be on an uptrend if trading above a moving average and the average is sloping upward. On the other side, a stock may be considered to be in a downtrend if trading below the moving average and sloping downward. Shares of Pointerra Limited (3DP.AX) have a 7-day moving average of 0.04.

When it comes to investing, people are generally told to make sure that they don’t put all their eggs in one basket. This saying can apply to investing in the stock market as well. Keeping the stock portfolio diversified can greatly behoove the individual investor. When hard earned money is on the line, individuals may want to pay extra attention as to how their equity holdings are spread out. Many investors will choose to pick stocks that combine large cap, small cap, and even international stocks. Although stock portfolio diversification does not eliminate risk, it can help reduce it during tumultuous market conditions.