After Thursday's pretty raise DEPO started the last session with a huge gap down because of the bad news. The price tested the bottom of August right after the opening and it proved to be the daily low (4.45). The buyers pulled the price back up quickly, but they were unable to fill the whole gap in (70 cent remained untouched above 5.24). Finally it closed at 4.94. It means, that it couldn't close above its main resistance.
If DEPO exceeds this level, than the price may continue the filling of the gap, although it has to overcome the 50-day moving average first at 5.66. Above the 50-day MA, the top of the gap and the local highs are the main resistances (around 6.50).
If DEPO exceeds this level, than the price may continue the filling of the gap, although it has to overcome the 50-day moving average first at 5.66. Above the 50-day MA, the top of the gap and the local highs are the main resistances (around 6.50).
On the other hand, below 4.50 a huge space would open up for the further falling trend. In this case we must examine the weekly chart in order to find the supports, where the short positions should be covered. In my opinion, 4.00 would be only psychological support. Below that, the price could probable fall quickly down to 2.5. This level meant support many times in the past. I think, that it could hold the course even in this bearish scenario.
Briefly: the outlook is bearish. Below 4.50 i won't keep any long position. The picture is a bit prettier, if DEPO returns above 5 and can stay above it for some sessions. To tell the truth, the prospect turns to bullish only above 6.50.
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