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Rite Aid Corporation Message Board

  • danboy2112 danboy2112 Oct 26, 2013 12:49 AM Flag

    Technical Bearish Divergence

    My technical analysis is telling me to get out of this stock - but I also know that sometimes you just have to take technical analysis with a big grain of salt - praying that fundamentals rule this stock and make all the classic technicals wrong. I hope so, but if she starts going below $5 on heavy volume - I think I might bail, and I hate to think I will.

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    • I am in the same boat but I am going to let the fundamentals control. Charts can be manipulated by one or more large traders who hit trend-lines or moving averages at key points and usually late in the day to create the chart they need to make their trades work. Short interest is high and they need to cover some - or all - of their positions before the nest monthly report. They may well try to close it below 5 in order to kick off margin sales but it would not last long...I think...and we would turn right back up....that is my best guess based on past, similar situations. I will probably buy into it since I am continuing to accumulate the stock for a very long term investment. SD is a good, recent example, of the same play by the shorts... if you look at a 1 year chart on it....good luck to you... Drummer

      Sentiment: Strong Buy

    • shutup

    • Looking over the technicals more, and it's almost as if you have to re-normalize this stock. When the indicators are saying price is heading south, which would be a good call for most stocks - looking at the history of this stock it's almost as if when things look their worst technically - is really just a good place to buy relatively cheap. First time I have been so actively involved in following fundamentals with a stock, I guess Peter Lynch was right - you can get spooked out of a lot of good buying opportunities if you don't follow the fundamentals.

      • 2 Replies to danboy2112
      • Just a sidenote:
        I have Yahoo messages on here trying to convince people that BIDU was a good buy at 85-90s. People were convinced that QIHU would be too much competition for them. Looking at the numbers you could see QIHU was nothing, but BIDU still dropped a lot. I didn't have many shares but unfortunately I got out before the run up.

        I have 1000 sh of RAD now. I mainly follow trends and look at quarterly and yearly numbers, but this looks like it has a lot of support at 5.00. They can try to take it down again but I dont see how it can go much lower considering we are going into the impulse buying season.

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