Temporary Correction Seen In Megawide Construction Corp.

Newly minted- Megawide Construction Corporation or MWIDE in the Philippine Stock Exchange has gained some pretty good gains since its listing last February 18, 2011.

From an opening of PHP 7.86 during its first day of trading, MWIDE has reached a high of PHP 9.80 today (June 29, 2011), gaining as much as 24.68% in a little over 4 months. A breakout from a continuation cup and handle pattern was actually the one that propelled it to the mentioned high. However, it appears that MWIDE could be bound for a correction soon or at least a consolidation.

As you can see from its daily chart above, a bearish shooting star pattern has formed in today's trading. This candlestick pattern exhibits that investors could soon take their profits since there weren't enough demand today to have MWIDE close somewhere near its daily high. So if I have a long position on MWIDE, I would take my profits as soon as I can and just re-enter once the stock has corrected back to say PHP 9.16, where the neckline of the cup and handle lies, or at PHP 9.00.

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