Week 21 (24th May-30th May): Royal Bank of Scotland-Weekly Moo River Watch

Royal Bank of Scotland


Yearly

Price Chart: the bears were having a laugh early this year, until the bear-wagon hit a rock and the bears fell off. The reason was everything was going well for them until they realised that it was nationalisaton or zero pence on this share they were headed for. 'What do we do now?', bears growled in dismay. If anyone had been shorting this share or any bank shares, they'd be billionaires by now. Strangely, despite all the bans on shorters etc, the Fortune's richest men list have not been filled with nouveau riches in the form of any bank share bears, how strange!

Reality is the only way for this share is upwards, however long it takes, though it might still be threatened with nationalisation at any moments of jittery economic news. If you had bought at 3 pence early this year, you'd made 10 times of your money, that is if you average down from 722 pence a share and still have enough money left and have not lost your nerves. The name Wallace the braveheart rings a bell here.

Quarterly

Price Chart: if you have been a long suffering shareholder, you must think twice about what they say about let the trend be your friend. This bear market has been so well managed since 2007 with every quarter producing a new lower low and lower high, that it is amazing that we did not see this final collapse coming sooner, including so many of our pension and fund managers. To date, we have not escaped this ginormous downstream moo river yet, though going to zero might not be an option here, so there is hope.

Monthly

Price chart: The downstream moo river is relentless, and we have just finished a meandering across from the lowerbank to the upperbank and ready for the next leg down, until we realised that the next leg down is to -115 pence, which is impossible, so now bears scratch their heads in disbelief, what do we do now? The only other alternative is to break this upperbank near 75 pence this month or 50 pence next month, which is the final month allowed by this downstream moo river, so there will be a decisive movement soon.

RSI: that one teaches you to think twice next time you want to say something is oversold. It almost dropped to zero on monthly RSI, shocking, isn't it?

Stoch: same story as RSI's, well stuck under the bottom of the deepest moo river.

But encouragingly, other momentum indicators have rebelled with W based rallies such as Elder ray and Momentum. Maybe, there is another life left in this 'dead' cat.

Weekly

Price chart: if you look at this chart, what does it remind you? Say it, yes, you can almost feel the pain of a constipator here. But the good thing we have almost managed the discharge out of the claws of all bears, meaning out of the downstream moo river, where bollinger band narrows in such a way that it is almost ready to burst into a new lease of life.

RSI: we have been kept by bears under 45/46 for the past few years, so a breach there will be very significant indeed, but we are showing some hesitation here already, old habits die hard, but there is no return, no return, as that way is to zero!

MACD: oddly shaped it might be, it is a ginormous W to the delight of those desperate long-term shareholders, we are bouncing up big time here in momentum.

Stoch: we have overshot ourselves here, though the W based rally has been a complete journey into 90's, which is a pleasant thought for bulls, though a M might take shape here to end the rally, which is long overdue.

Repulse: The W shaped rally must give the bulls hours, days and weeks of pleasure and encouragement. The power of WM is not to be ignored, as that is the strongest of all and the most sustainable of all.

We might create a bearish divergence shortly, if we do not fall off the cliff from here, meaning a price rise based on waning momentums.

Good luck.