Selected penny stocks have been driven to new seven to nine year highs by speculative buying. Oceanus Group, which is still under the SGX’s watchlist, was queried by the Exchange on Feb 19. Its share price has surged since UOB Kay Hian pointed out that the company is attempting to turn around in a January report.

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Technically, Oceanus stock remains on an uptrend. However, quarterly momentum is falling, and it could continue to fall. This is setting prices up for a negative divergence with its quarterly momentum which is a sign of latent weakness. In addition, prices are at a record spread above their moving averages. In particular, prices are at an unsustainable 368% above their 200-day moving average. At any rate, with prices at 7.5 cents, they are soon likely to encounter resistance as they approach the 2012 breakdown level of 8.4 cents.  

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