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Technical Update - Sea Ltd failing to break key resistance. Technical picture is bleak

Equities 2 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

Summary:  Sea Ltd gapping lower demolishing and reversing the bullish trend. The technical picture suggests price levels below 60 are not unlikely


Sea Ltd – ADR gapped lower yesterday after earnings. It came after the share price once again failed to break above strong resistance are at around 89.55

The sell-off yesterday pushed the share price below the short-term rising trendline and has reverse the uptrend to a confirmed downtrend. Sea is below the Ichimoku Cloud which is a sign of underlying bearish trend and RSI closed yesterday below 40 threshold i.e., negative strength sentiment indicating likely lower Sea levels.

Sellers are likely to try closing the gap from March i.e., a move to support at around 65.67 and the 200 daily Moving Average

 

Sea d 17may
Source all charts and data: Saxo Group

Medium-term Sea is testing slightly rising trend and seems to be continuing the Bubble pattern collapse.

If breaking below the lower rising trendline Sea is likely to drop to 57.95 , possibly lower. Bulls can, however, cling their hopes to the weekly RSI that is still showing positive sentiment. However, RSI has broken below its risisng trendline and if closing a week below the trendline it is an indication RSI is likely to test the 40 threshold.
If the weekly RSI is closing a week below 40 and a price close below 57.95, it can send Sea into a tailspin to test November 2022 low at around 40.67

To reverse this bearish picture a close above 89.55 is needed.
A close of the gap from yesterday would be first indication of that scenario to play out.

 

Sea w 17may new

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