Chinese solar stocks remain volatile and are expected to do well when news from Europe are encouraging. But given that that's not the case today, think of Fitch's downgrade of Greece just today, outlook is not all that great for LDK Solar (NYSE:LDK) right now.
But a recent pullback from New Oriental Education (NYSE:EDU) makes the stocks ready for more upside, according to the overbought screen. The stock touched theoretical highs yesterday, experienced a correction and is looking good from a technical point of view again.
Aluminum Coirp. of China (NYSE:ACH) and Guangshen Railway (NYSE:GSH) are looking very similar to EDU from a technical point of view.
Shanda Interactive (NASDAQ:SNDA) shouldn't trick investors on the oversold screen - the company went public and is off the NASDAQ. More downside is possible tough for Global Sources (NASDAQ:GSOL), General Steel (NYSE:GSI) and China Sky One Med. (NASDAQ:CSKI) for these stocks haven't reached theoretical lows yet.
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.