Come this Tuesday, the 28th, it will have been 3 weeks ago that CXW gapped-up +15� on rather convictionless volume on the order of +172% of its (then) 3-months' ADV.
Back then, CXW's 50-EMA was on the ascension and its 150-EMA was in the midst of its process of bottoming out. Since then, its 150-EMA has begun its rising track and, as has been mentioned on this mb in an earlier message, the 50-EMA has crossed above the 150-EMA while both were on the rise, triggering what technician Victor Sperando considers a "Buy" signal.
Back then (6/07/05), the industry's Group Relative Strength (GRS) numerical ranking for the Commercial Services-Security/Safety (CS-S/S) group, was 125th out of IBD's 197 groupings. In its NYSE reporting, IBD shows that numerical ranking as equating to a letter-designation ranking of "C," which doesn't make sense to the General since 125th out of 197 should be more like a "D+".
CXW's Accumulation/Distribution (A/D) rating on gap-up day was a (neutral) "C".
As of the close of last Friday's session, the CS-S/S GRS ranking has slipped to 166th out of 197, which the IBD calls a "D" (insofar as its reporting of NYSE stocks) and which, to the General, seems more like an "E+".
CXW's A/D rating remains a neutral "C".
BTAIM (Be that as it may), the 6/06-07/05 gap-up's price discontinuity (from 37.58 to 37.73) of +15� remains unclosed and, at its i-d l of 37.87 last Friday, it came within 14� of starting that closure, a process that CXW seems intent on completing before it moves on with wherever it's bound for (which Sperando . . . & the General believe is higher).
i_c_b, the General's answer to your question, << Time to retreat? >> would have to be, "It depends."
What it "depends" on, is whether the reader is a short-term oriented trader (which the General is NOT), or a long-term oriented investor (which the General IS).
If the reader is short-term oriented, then the General still sees "technical" weakness in its recent chart behavior, which is not surprising given that its Commercial Services-Security Safety (CS-S/S) industry group is currently ranked 141st out of 197 groupings.
Converted to a 'letter'-ranking rather than a numerical one, IBD calls that a "D+". The General thinks that that's somewhat 'generous' on IBD's part. He'd call it a "D," bordering on the cusp of a "D-".
3 months ago, the CS-S/S group ranked 74th out of 197 groupings (a "B-") and 6 months ago it commanded the 28th ranking (an "A-" on the cusp of an "A").
So its industry grouping has been declining in market favor over the past half-year. Nothing like that ever happens in the stock market, as we all know. Today's heroes never become tomorrow's bums and vice-versa.
If one looks at CXW's long-term chart's trend since Ferguson has been at the helm, one sees that, while there have been periods of decline and consolidation, some lasting as long as a year, there are still viable long-term UPTREND lines, each succeeding one being greater in positive slope than its proximate predecessor.
The General has not taken the calc'ing time to present them here, but if anyone's interested, he might do that (schedule permitting).
The "revelation" that the General's prediction was correct some time ago now puts him in a quandry. He can't remember what brand of Ouija board wax he was usin' at the time.
I can't say I'm a believer in TA but I believe there are solid fundamental reasons for the recent strength in CXW. The Co. has said that they originally expected a tax settlement with IRS to be expensed in equal payments during all 4 qtrs. in 2005, and then IRS req'd. the payment be made in the 1st. qtr. As a result, this expense will disappear in qtrs. 2,3, & 4. In addition, 2qtr. will have Ohio Pen. 50% take or pay for 30 days, 60 days take or pay in 3qtr. and 90% take or pay for 30 days, and 90% take or pay for 120 days in qtr. 4. So there will there be a clear uptrend for rev.and earnings thru the rest of this year, all other things being equal. The upward trend of incarceration is continuing its long term pattern w/o any indication of interruption, CXW is continuing its qtrly free cash flow of about 30$ million AND if you look closely you will see that during late afternoon trades in the last several months the stock has been rising on strong volume, including Friday's ending trade, in volume, indicating that someone or group is accumulating.