Hello all,
I have charts of DMX Tech for you all. Some months back, DMX got into the news because of ADR – related issues. Some of you may have been following this counter. Anyway, the hype has passed, and I will show you all my take on DMX.
Recovering from the crash of 2008, DMX made a nice run before losing some steam in 2010. After its 500% + run in 2009, DMX traded down in what looks like a loose downward parallel channel (highlighted in red). The ADR hype caused DMX to explode out of the strong, large channel. Evidence of a change in fortune, DMX’s is now comfortably above the 200-week MA. You can also see a green support trendline I have included in the chart below. What I am seeing on DMX’s chart are signs that indicate to me that DMX may be in for a surge up to test the 52 -54 cents region.
On the daily chart, you will see a small upward parallel channel, drawn in black, to indicate the slow rise DMX has been in for the past weeks. Price could retrace a little in the days ahead, since we are at the top of the channel.
I would like to draw your attention to the general shape that I have identified on DMX’s chart. From the highs in 2009, DMX has traded down to a low of 28 cents, before reversing its downtrend in the latter half of 2010. What I am seeing on the chart is a rounding price action. In other words, I can draw a bowl, connecting all the lows. Usually, price will trade up all the way to the left tip. I am unsure of what to call this “pattern”. Some of you may have names like rounding bottoms, saucers, potential cup with handle, whatever else. For me, I will just see this as a rounding price movement, and expect price to hit the level where it started from – in this case it is around 53 cents. 
Also, there are ”rough sketches” of what seems to be at least one inverted head and shoulders. This is highlighted in light green; and another in rectangular boxes (I am not convinced about this one though). When I see such large patterns that have smaller patterns in them, it does mean that something significant may happen soon. For now though, take note of the rounding movement.
Last but not least, price is above the 200-day MA; and, the MA is turning up as well. These are small bullish signs to take from a chart.
With all these bullish indications, I will be watching DMX Technologies in the days ahead. Let’s see how this goes.
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