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Elan Corporation, plc Message Board

  • oxledge oxledge Jan 12, 2006 1:26 PM Flag

    The Battle at the 500 day moving avg

    Dear fellow longs,

    ELN has delivered a price increase as predicted and we are surrently at the "infamous" 500 day moving average. Most techniciancs would call this a sell point. I suspect that there may be technicians that have bought into the ELN momentum and some of these bozos will bail here. We may also see some computerized short selling here as a number of hedge funds run systems shorting stocks as they go into a major moving average, looking to profit by a short term drop.

    Despair not! ELN is in an interesting position. Fundamentals remain exceptional, pointing to a higher price in hte next several months. We also have no "prior" buyers at this price from 2005 who are happy to unload "at their cost" given the beating they would have taken on the way down. If there were any such characters around, they would definitely be selling here. But, alas, there are no such sellers.

    The question remains. Can we go through the 50 day moving average unimpeeded. I think it is possible. But it is also possible for ELN to "fail" at the 50 day ma and stage what i believe would only be a very modest decline. If such a decline were to occur, buyers are ready to swoop in. The trend and fundamentals here are too obvious to the experts in the industry. Shorts are scared to death and know that $25-30 is in the cards. Any correction will result in ongoing buying.

    Therefore, my advice here is not to sell your shares into the 500 day moving average. Sit tight! You will not be smart enough to time your reentry into the stock if you sell here. Why try to save $0.50-$1.00 short term drop, and potentially leave $15 in additional share price appreciation on the table. Selling here is a bad bet. Hold your position in the shares. Higher prices are coming.

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    • I'm confused.

      Is it a 50 day or 500 day ma. And do you know anything about this company?

    • Got to tell you I have made more money on this stock than any in my life. I been here since 4.52 in April and any sign of weakness I am gonna try and swing it. Guess I can't stand prosperity but I would hate to lose what I have gained all last year. No doubt we will go higher but a pull back is warranted. Kudos to those who can hold. You are a far better investor than myself but I feel there is nothing wrong with taking a profit. I can never time the tops and I am real happy with what I have made. I just hope I can get back latter but I am not chasing it. GLTALS

    • Good observation about that benchmark. Interesting to note that we definitely closed ABOVE the 500 day moving average.

      Slow train? Hmmm.

      Go big ELN.

    • Well said...

      I would also recommend all longs who use options to have cheap way out of the money puts to cover themselves. Long or short, NEVER go naked...

      Best Regards

 

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