With the stimulation of the released shareholder update yesterday, Medinah Minerals Inc (PINK:MDMN) soared 27% and exited at least for a while the lifeless mire of its trendless price channel.
MDMN was meandering between $0.09 and $0.12 since April and had already tested four times its support and three time its resistance. Finally, the stock managed to penetrate the resistance on a fairly higher than the average volume.
While the 90-day trailing average volume of MDMN is currently anchored at 2.26 million shares, yesterday’s volume reached well over 14 million shares. One might think that this was a record 52-week value for the company, but it is not. MDMN generated even higher volumes in the beginning of the year on a hype around its Alto Lipangue mine.
The press release induced surge caused a major reform in MDMN’s technical configuration. The divergence between MACD and the moving average increased and the histograms started pushing up, which is a good sign for the long investors.
An interesting picture form in the 
DMI indicator as well: the green and red line of the indicator suddenly went in the opposite direction, increasing the distance between them. This as well is a coveted sign by long investors, who might have also noticed the climb of the ADX line over 20.
At the same time, oscillators such as the RS indicator expectedly headed to the overbought area, but have still not crossed the critical line.
At such technical breakouts, swing traders usually pay attention to the longer term moving averages who can signal several critical areas. At present, such point is the 50-MA, which is at $0.108 and may become critical if the stock decided to retreat back down.
On the whole, yesterday traders had an awarding opportunity for their MDMN investments, but it is now more vital to ask how long will this hype last. The historical chart of MDMN may provide a clue after checking how long did similar surges last in the past.
