StatsChipPac Technical Analysis is showing signs of a possible bullish move. Here’s the weekly chart of StatsChipPac  that goes back to June 2010. StatsChipPac made a high of 1.51 in Oct 2010 and then the price started to slide down all the way to a low of 0.29 registered in Nov 2012. The price has since recovered to 0.535 before going into a corrective trend channel.There are a few points to note in the weekly chart. First is the volume. The volume has been low all the way from the high of 1.51 to the low of 0.29. Just prior to hitting the low of 0.29, there was a strong rise in price and this was with heavy volume.

STATSChipPac Weekly Chart – 16 June 2013

Right after it hit the low of 0.29, the price surged swiftly and this price surge is once again with heavy volume. Relatively, the volume in this second price rise was heavier than the first one. This is an indication of strong buying in StatsChipPac.

Next, we take a look at the Daily Chart of  StatsChipPac. Here we can have a closer look at the price action of  StatsChipPac since Nov 2012 when it hit the low of 0.29. The price rise that followed is impulsive in nature as it is confirmed by the MACD as well as volume. A lot of price gaps appeared which means that the buying was genuine. This rise in price was then followed by the correction which is still progressing. As evidenced from the chart, the correction is choppy in nature with a lot of overlaps. The MACD is flat and the volume is much lower than the volume on the way up.

STATSChipPac Daily Chart – 16 June 2013

This points to a potential bullish setup for  StatsChipPac. According to Elliott Wave Principle, a five wave impulsive move that is followed by a corrective wave will in turn be followed by another set of five wave impulsive move. The second set of the five wave move minimally will be equal to the price length of the first five wave move. In a strong bullish setup, it could rise as high as 1.618 times the first set of five waves.

As the price action on  StatsChipPac is currently bounded by a trend channel, it also provides for a good price guide. A breakout of the trend channel with volume and in an impulsive fashion to the upside would be the signal of the start of the next bullish wave. The price could break the trend channel to the downside as well and that would be a bearish situation. That is the reason why it is better to wait for a clear break out of the trend channel before taking up a position.

For investors who are already invested in  STATSChipPac, it is probably better to hold first as the price is at the bottom of the trend channel and the chance of going up is higher. Also, the price has gone slightly below the 61.8% Fib level of the rise from 0.29 to 0.535. The 61.8% Fib retracement is a normal retracement level (though it can go lower to the 78.6% Fib level at 0.34) and this too points to a higher chance of going up from here.