Based off 128 votes on a Twitter Poll conducted by Sunny, IFXY won for a Technical Analysis blog packet for this week. Without further delay:
Infrax Systems Inc.:
Is this movement viable or is their chart their own worst enemy?
Where did this Journey begin for us?
We have been watching IFXY for a little over a week of trading now. In this post, we will go over the technical analysis of how IFXY got to where it is now. We will determine price channels, strength of this trend, and several other technical gauges to answer this question to the best of our ability. Let’s dig into IFXY and see what we can find –as the technicals will show all.
The most important aspect to this is the start. How did IFXY start this movement from a technical standpoint? How many shares were traded in low trips? Where was the first base established? Most importantly, have the proper price channels been fulfilled to allow continued movement?
In low trips, where these movements start, it is very important to first look at .0001 – .0004 as the first important level. There were a lot of shares loaded .0001-.0004 before IFXY began its big run and if this channel hasn’t been properly churned it could lead to the multiple resistance rejections we have seen.
.0001 – .0004 = approx 1,484,000,000
The most interesting aspect I noticed (where this massive loading was happening on IFXY between trip 1-4) was the red day in the middle (as shown in the above graph in the blue boxes). We have an extremely low volume red day which can only lead to one conclusion: traders were not selling –they were legitimately loading and holding for higher levels. In my opinion, this is what led to the large pop the following day going from .0004 – .0011. Taking a deeper look into that may answer a lot of questions about resistance issues on this chart.
The problem here is simple, from my perspective. We had 903 million traded between .0004 and .0011 on a stock with this large of an SS (Share Structure). This is where the inability to hold resistance breaks began. Is this bad? No, not at all. This is simply an answer to a problem IFXY has had. Let me explain: IFXY had 1.4 billion shares traded between 4 ticks (trips 1-4) but then only 903 million traded between 7 ticks (.0005-.0011). This caused another base not being properly built which led to the downturn I will show next and the need for that channel to be properly built later on. Typically, on a larger SS stock such as IFXY, I would have liked to see a .0005 – .0009 channel and new base properly built. IFXY simply ran too much too fast without enough volume which led to this downturn shown below.
The downturn shown above is the result of not properly building a higher base and failing to fulfill a previous price channel. This is a great example because you actually see the stock re-correct all the way down to the original price channel of .0004. In order for a stock to re-continue its uptrend, in this case it has to build a solid .0005 – .0009 base. I personally don’t think it had properly completed this .0005 – .0009 price channel until Thursday November 2nd –due partially to it going up too fast –indicating lots of flipping and possible dilution. I’ll show you how and why I think the second base of .0005 – .0009 is now complete and why it just happened Thursday.
Approximately 4.4 billion shares were exchanged during these days (shown above in the blue box). More than triple that in the .0001 – .0004 range. Many may ask “…how is that possible with 1.4 billion traded between 1-4?” Simple, it is usually because of flipping or dilution. The way that you can tell that this .0005 – .0009 price channel is finally fulfilling is the fact that we are getting higher lows. This means that people are buying higher, selling higher, and flippers are looking for higher gains/buying higher ranges. Today, November 3rd, is the first .0008 low with not only a higher high but also a majority of shares traded above .0009. This is telling me the channel is fulfilled/or very close and the IFXY holders must start working towards the churning of .001- .002. Higher low seen below:
What is the next step for IFXY in all of this?
The next step is simple, start getting closes above .001 and especially .0009. There have been more than enough shares exchanged now to start creating a higher base. In order for IFXY to be successful, from our perspective, they have to start getting lows above .0009 and need to do it quick.
Other Important Indicators
The accumulation on IFXY shows indecision to me. Is it gradually rising? Yes, but it also shows weakness on its spikes. I like to see continued uptrends, not dips and rips on the accumulation meter. You always want to see people holding as this shows lots of distribution in the .00’s which explains the .0011 resistance issues.
On Balance Volume shows much of the same and that’s the inability to generate higher volume on the IFXY spikes. This is another indicator you want to see a continued rise on, not up and down spikes. This is showing the lack of volume flow to IFXY in that .00’s range.
This is actually one of the few indicators showing some sort of strong trend strength. This is most likely due to the higher lows and higher highs being achieved by IFXY. This indicator in particular will be interesting to monitor going into next week to see if that number continues to climb.
To Start, is IFXY making higher highs and higher lows? Yes. Does that usually notate a strong uptrend in progress? Yes. I, however, remain skeptical and on the fence. There are many indicators within IFXY that don’t point towards longer term uptrend strength. The failure to achieve a close above .001 again and the accumulation/OBV indicators show a lot from our perspective. Can all this change in one day with news? Yes of course, but how it stands, our technical team stands very in the middle on IFXY and we will continue to trade it as such. Buy supports and sell resistances until IFXY can show longer term trend strength.
Technical Analysis by Alex S; Owner/Founder
You can follow him on Twitter @SUNNYLAND24
Compiled/Proofread by Noëlle H; CTO/Site Administrator
You can follow her on Twitter @subliMINXal
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