April 10, 2012 (Chinavestor) After a series of pull backs, there are no overbought Chinese stocks to watch this morning. E Commerce China DangDang (NYSE:DANG) is trading closest to theoretical highs but even this stock is far from being overbought. Most other liquid stocks have been trading in a narrow range but that might change when the market breaks out. Stocks to watch include Shanda Games (NASDAQ:GAME), 51job Inc. (NASDAQ:JOBS) and hotel chain operator Home Inns & Hotels Management (NASDAQ:HMIN).
Most of the action is taking place on the oversold screen, scroll down to check it out. Origin Agritech (NASDAQ:SEED) and China XD Plastics (NASDAQ:CXDC) are clearly oversold. Silvercorp Metals (NYSE:SVM) is one of the most liquid stock on the oversold screen that is poised to do well should market sentiment improve. For details, scroll down to the second chart.
Origin Agritech (NASDAQ:SEED) has reached theoretical lows and is oversold. Even better, China XD Plastics (NASDAQ:CXDC) fell too hard too fast and is expected to bounce back up with the market.
Solar stocks have felt a lot of heat lately as Europe's problems drag on. Renesola Ltd. (NYSE:SOL) is oversold but Trina Solar (NYSE:TSL) or JA Solar (NASDAQ:JASO) are less so. These latter two have more downside left, according to the oversold monitor.
Sina Corp. (NASDAQ:SINA) is not oversold despite recent losses. The chart tells investors that Sina (NASDAQ:SINA) can go anywhere from here, the oversold chart is not indicative of any particular move today.
Overbought A technical condition that occurs when prices are considered too high and susceptible to a decline. Overbought conditions can be classified by analyzing the chart pattern or with indicators such as the one above. A sharp advance from $15 to $30 in 2 weeks might lead a technician to believe that a security is overbought. Or, a security is sometimes considered overbought when the stock is trading out of its trading envelope and is approaching the theoretical high. It is important to keep in mind that overbought is not necessarily the same as being bearish. It merely infers that the stock has risen too far too fast and might be due for a pullback.
Oversold A technical condition that occurs when prices are considered too low and ripe for a rally. Oversold conditions can be classified by analyzing the chart pattern or with indicators such as the one above. A sharp decline from $30 to $15 in 2 weeks might lead a technician to believe that a security is oversold. Or, a security is sometimes considered oversold when the stock is trading below its trading envelope and is approaching theoretical lows. It is important to keep in mind that oversold is not necessarily the same as being bullish. It merely infers that the security has fallen too far too fast and may be due for a reaction rally.