already the stock has begun to give small failure signals, starting with the fact that the stock went below the previous high at 11.25 today. The flag formation suggested that would not happen but it did happen today. By the same token, the day's low at 10.91 is not yet enough to make a statement for the bears. meaning that it is still in question. By the same token, the indexes did not see any follow through to the upside today after last week's strength, and with the same thing having happened last year which was then followed by 6 weeks of weakness, the possibilities are good that it will happen again. If KNDI bulls do not get the support of the market for higher prices at this "pivotal" level, it does increase the chances that no confirmation to last week's breakout will occur this Thursday.
If KNDI fails here it will be a big "chart" disappointment and the traders that are always looking for paths to easy profits will pounce on the stock to push it down as much as they can. Can anyone tell me with confidence at what price there will be guaranteed buying interest? the answer to that question is "no" and that is why the traders will turn bears very fast if the stock fails here because the path of least resistance will be to the downside as no one has a good idea of where buying interest of consequence will occur.
You guys can think whatever you want of me, but all of this information has been gathered over the years by talking to professional traders that do this for a living. It is what the professional traders look at, consider, and trade off of. Whether it helps you trade or not is not my decision to make, but giving you the information I have gathered over the years is a plus and not a minus. After all, information is always valuable even if you do not heed it, unless of course you want to live in a fantasy world of your own making. In that case, anything that is not to your liking will not only be dismissed but criticized heavily.
Let me take this opportunity to explain something to all those that do not understand what technical analysis is or does.
First of all, there is NEVER a clear answer to any question, just probability numbers. Any stock can go up, it can go down and it can go sideways. Nonetheless, knowing what the probabilities are is always of assistance. It is much like a manager of a baseball team needing to replace a starting pitcher and knowing what the tendencies are of the upcoming batter and of the pitchers at his disposal. He never knows for sure if his decision will win the game for him or not, but knowing the tendencies (probabilities) will increase his chances of winning. Over a period of a season (like trading for the year), more right than wrong decisions likely means a winning rather than a losing record.
In addition, there are many guidelines that all technical traders follow and knowing those guidelines helps make right decisions more often than not, like getting out of a trade too soon or too late. For example, a break of resistance, as seen on Thursday in KNDI when the stock closed above 11.31, does suggest that the stock will head higher. Nonetheless, the market is often manipulated to trigger stops, #$%$ fakes, and to fool the people that are not aware of the guidelines so the smart traders can take advantage. All breakouts, such as the one seen on Thursday, need to be confirmed the following week. It is a guideline that tech traders follow because if it was a head fake, the follow through buying will not be there the following week. Sometimes a breakout is convincing and confirmation is almost moot. Nonetheless, in the case of KNDI, the close 20 points above 11.31 was not all that convincing, meaning that waiting another week made common sense.
These are the decisions that have to be made so that a trader does not get "chopped up" in the market but still keeps a handle on what is happening.
On November 2nd I gave a buy mention here on this board to purchase WMT at 56.85 with a stop loss at 55.58. I gave a 63.00 objective which is probably going to be reached this week or next.
Below is the comment about the trade that will appear in today's newsletter.
WMT made a new 10-week weekly closing high on Thursday and the stock closed on the highs of the week, suggesting further upside above last week’s high at 61.12 will be seen. The stock is showing a bullish flag formation with the flagpole being the rally from 56.30 and 61.47 and the flag the trading range seen the last 5 weeks between 58.31 and 61.47. A break above 61.47 would offer an objective of 63.48, which is the mention’s objective. Support is found at 58.75 and at 58.31 and resistance at 61.12 and 61.47. Probabilities strongly favor the bulls this week but it does need to be mentioned that this buy purchase will be liquidated above 63.00 as I do expect the stock to get back into a $57-$63 trading range for another month or two thereafter.
If interested in additional information about the service I supply, let me know through this post.
KNDI generated a strong week as well as a close above the previous low weekly close at 11.31 that caused the 7-month downtrend to occur. A green close next Thursday (weekly close) would be confirmation that further upside will be seen with the flag formation objective of 14.70 as the objective. The stock closed near the highs of the week and further upside above last week’s high at 12.00 is expected to be seen with the 100-week MA, currently at 12.20 as the objective. Nonetheless, this is a pivotal week since the weekly close on Thursday at 11.51 can still be considered a successful retest of the previous low weekly close, if and when the stock closes in the red this week by at least 20 points. With the indexes expected to generate a red weekly close, it could be enough to prevent the bulls from getting the chart confirmation they need. Intra-week support of some consequence is now found at 10.65. As such, a potential and possibly probable trading range of 10.65 to 12.20 could be seen this week, with the close next Thursday being the deciding factor as to what the stock will do the next few weeks.
Forlix, I must admit that over the years my not adhering to my stop losses points has cost me more than what I achieved by not adhering to them. Nonetheless, I still have to make that call each and every time for the simple reason that this is not a paper game but one where real money is involved.
If I feel that I can get a better price by waiting I will normally do so, even if it is only a few dollars and just a day or two.
The weekly close above 11.31 has now made me have my "finger on the trigger", meaning that I am much more likely to get out than not. The stock would literally need to give a failure to follow through signal next Friday for me to stay with the positions. Also keep in mind that I only have a small portion of my portfolio involved in the trade and as such, money-wise there is not a whole lot of additional loss that I will take by keeping the positions over the weekend, especially since the stock would need to open higher on Monday by at least 47 points to just get back to Monday's high in order for me to lose more money than what I was losing on Thursday.
This is a personal choice as I do not manage accounts for other people, meaning that I give the stop loss to my subscribers and they are the ones that will make their own choices whether to respect the stop loss or not. For me the decision is always "can I get a better price the next day or not? Every day until next Friday, I will make that choice (get out or stay) based on the action that day. If the action any day this week suggests the stock will go higher, I will get out. If the action suggests otherwise, I will stay in for "one more day". Next Friday, if the stock closes once again above 11.31, I will get out for sure.
I don't know that I would classify it as "procrastination". Next week is likely to be as slow as molasses and therefore not likely to cost me additional losses of consequence. As such, waiting an additional day, or even an additional week, makes common sense. Why take the loss if there is no immediate reason for doing it. I am in the trade in the hopes of making money, not trying to fulfill whatever requirements you think I should fulfill.
I decided to keep the short positions over the weekend, mostly because the bears were able to manage a red close today and only 20 points above 11.31. Closing 20 points above 11.31 is considered a bit iffy, as far as a breakout is concerned, since a red close next Friday would still offer today's close as a successful retest of that level. Nonetheless, the probabilities are high that I will cover the shorts on Monday since it is still above the previous high at 11.25 and certainly above 11.31.
I can't consider buying long yet since the closest place I can put a viable stop loss is at 8.26 and buying here at 11.70 and having a 14.70 objective would offer only a $3 profit potential but a $3.50 risk factor, meaning the trade would not even offer a 1-1 risk/reward ratio. I will not consider putting on a trade that offers less than a 4-1 risk/reward ratio based on support and resistance levels. There are too many other stocks that do offer that kind of risk/reward to consider any that don't.
As far as posting before on the SSFT/NUAN board, the answer is "yes". In fact, I started posting on that board in 2005 and started my service in 2007 with 13 of the members off of that board. Three of those members are still with me after 8 years.
Actually, with tomorrow the market being closed, today is the weekly close. I will probably cover my shorts today if the stock closes above 11.31. Nonetheless, I will make that decision at the end of the day. As it is, normally any break of resistance needs to be confirmed. By the same token, if the stock closes above 11.31 today (by at least 10 points) it is unlikely that the bears will have any success next week, meaning that I will probably take the loss today.
The stock has been acting well and it is looking like the stock will be heading higher even though I am still strongly convinced that the indexes will end up heading lower at the beginning of the year. By the same token, the flag formation that got broken to the upside this week, does suggest the stock will likely outperform the index market and with a 14.57 objective to be reached over the next 5 weeks, it does not make sense to hold the shorts if the bulls are successful in closing above 11.31 today.
Hey, I take losses all the time. This certainly will not be the first or the last. The game is to make more profits than losses and even with KNDI that is still the case. Remember that I purchased the stock at 5.07 originally and have a $3 profit in the stock. Getting out today will simply put me about even on my KNDI trades.
By the same token, I am long FSLR from the $40's (stock trading at $65), I am long QRVO from the $40's as well (stock trading around $55) and did purchase CLB and EOG on Monday and I am already up about $6 on CLB and about $3 on EOG (per share) in just 2 days. It all works out in the wash.
Good Luck to you on your long KNDI trade.
Thanks Chasen, I may take your advice. As of now, I have placed baby and jc on ignore, meaning I will not only not have to read any of their diatribes but will not even see their posts anymore. I have gotten 2 new subscribers to my service from here, so there are a few people that value what I post, but I doubt there are many more. If I do exit KNDI this week, which is a high probability, I may not come back. I will try Silicone Investor.
Baby, you are living in a fantasy world where anything you see and everything you do is perfect, facts notwithstanding.
"writing a lot of crapola (eg chart update)" is pure gold........in a fantasy world. Actual company progress, as seen by your eyes, takes the star billing, as if it means all that much in a world where slow growth, recessions, strong dollar (versus all other currencies) and general weakness in most companies (other than the really big ones) means nothing. Then again, it is a fantasy world so rules and common sense mean absolutely nothing.
"Use the ignore butter, as you do it all the time" is another pure gold statement, especially when you don't use it yourself, though you say you are doing so. I have not seen you ignore ANY of my posts.
.....and calling me a spammer is the absolute best. I must say that calling me a spammer is the star statement of yours. I am simply a chartist and see things differently than you do, but in your book anyone that is not simply bullish long term on what you consider to be a great investment MUST BE a spammer. Like all people that take the opposite side of your outlook is a spammer. Talk about the negatives of living in a fantasy world.
It is you that is sick in the head and needs a shrink because fantasy will never beat reality, no matter how much you rant and rave about it. My gawd, you are a sick puppy. I truly pity you.
For the past 7 weeks the indexes have been somewhat in a downtrend, though it is more of a "roller coaster" than a defined downtrend. Rallies and falls have been the norm and not the exception. By the same token, the highs have all fallen short of the previous highs and the lows have all been making lower lows, meaning the bias is to the downside.
Simply stated, the rally seen this week is just part of the pattern but since the previous highs have not been broken, it has to be assumed that the pattern will continue.
In the DOW the previous high daily closes (starting on November 3rd) have been 17918, 17888, 17845, 17784. As you can see, each high daily close was lower than the previous one. As far as the downside is concerned, the closes have been 17245, 17265, and 17128. In the SPX they are 2109, 2102, 2091, and 2073 and to the downside 2023, 2013 and 2005. In the NAZ they have been 5147, 5165, 5142, and 5070 and to the downside 4927, 4933, and 4922.
The fact remains that with the raise of interest rates, the bulls have no ammunition "at this time" to generate anything more than this roller coaster type action that is likely to continue with a slight downward bias. The fact that we are presently in a period of low volume and low participation will not change that fact, meaning that this rally being seen is likely on its last legs.
The bulls need to generate a daily close in the DOW above 17784, in the SPX above 2073 and in the NAZ above 5070 in order to accomplish "anything" positive. With the DOW presently at 18585, the SPX at 2062 and the NAZ at 5040, the probabilities do not favor much more happening to the upside.
What is now going to be important are the earnings reports and even then they probably won't be all that important until the second quarter. Why? Because the interest rate hike will not show many positives or negatives until the second quarter. Downward bias is likely to continue.
You really are a BAD reader Jc and an even worse critic.
I stated just 2 days ago the following comment "The break above the top of the flag gives an objective of 14.56 to be reached within a period of 6 weeks.". The link you gave to the Tech Trader chart analysis gives a 14.70 objective. It is the absolute SAME THING I stated. You stated THEY have helpful analysis, so then mine must also be helpful because I said the same thing and said it FIRST.
The only thing that I stated additionally is that the bulls need to close the stock above 11.31 on Friday and they can't have any fall back on this breakout.
Geez, do you need new glasses or just the ability to read and understand. You are a lost case. I guess I will just have to ignore you as there is not one thing you have said that is interesting, makes sense, or even has any facts attached to it.
Did you come up with that Sanskrit term (Guru) all by yourself? or did your Mommy help you with it? I didn't know someone on these boards could come up with such deep and spiritual word to express their thoughts about someone. And then even more impressive is your ability to put it together and come up with "wannabe-a-legend in his own mind" connection. Wow, you have somehow become my idol now........or your mother, whichever came up with the term.
Excellent post baby. The figurative expression or idiom of "calling a spade a spade" has put you in the same category of writers as Oscar Wilde, Somerset Maugham and Charles Dickens. I am impressed by your use of the English language and wish to be just like you when I grow up.
JC, you have become what you were trying to achieve, a worthless critic with eyes closed.
Worthless dribble eh?. It certainly is not worthless to the people that have written about these technical and time-tested guidelines that have helped them sell books and trade successfully for themselves. Each and every one of the people that have written these guidelines are proven successful traders. You call their teachings "worthless dribble"? Who are you to criticize. What do you know?
I have used these guidelines and made money myself on them, over and over again. What do you have to show?
Then again, I don't even know why I am writing this to you as you are oblivious to anything other than buying, holding and hoping that you can last long enough in the trade to make some money in the end. The old adage about taking a horse to water but not being able to "make him drink" certainly applies to you. Blind people can never see the light.
I have now placed you in the same category as ohbabyno, which is a category of people that I will mostly ignore and not pay attention to.
The bulls have now accomplished something that could be of note, which is to break out of a bullish flag formation with the flagpole being the rally from 5.05 to 11.25 and the flag being the trading seen the past 8 weeks between 11.25 and 8.36. The break above the top of the flag gives an objective of 14.56 to be reached within a period of 6 weeks.
Nonetheless, here is what is important to note:
The breakout "commits" the bulls to fulfill the objective without any pullbacks of consequence and more importantly without falling back, especially on a closing basis, below the breakout level at 11.25.
This technical rule is mostly set in stone and means that if the bulls fail to fulfill the technical guidelines of the breakout, that the opposite of the breakout amount will likely be seen below the low of the flag, meaning for example that the high seen so far today up to 11.62, which is 37 points above 11.25 would generate a move back down to about 37 points below the bottom of the flag at 8.36 (suggesting that a failure here and today would thrust the stock back down about $3+ and down to 8.00.
This chart information is not dependent on the stock closing above 11.31 on Friday, it is here and NOW and meaning that the bulls have to keep this rally going up. If it stalls here and the stock closes on Friday at 11.31 or lower, the failure of the breakout of the flag will likely doom the bulls for the next few weeks.
I am telling you this so you can see and evaluate the trading yourselves every day from here on in. This is one of the benefits of knowing charts as these type of technical rules that exist allow you to measure where exactly your investment is heading and how much it will achieve, as well as whether the breakout is for real or not and what failure means.
Simply stated, the bulls are now committed and have the edge. By Friday, you will know if this is a real breakout or simply a head fake by the traders to lure more people in and then lowering the boom
I see, in other words my purchasing stocks on a day they are falling and fundamentally the industry is very weak and buying them within with a stop loss less than 1% away and NOT GETTING STOPPED OUT and now seeing paper profits is not something that you are interested in hearing so that you can amend your stupid statement about "my having no clue".
Let see you do it just once. I do it all the time. It is called "having a clue, a good clue as to what I am doing".
Don't you ever get tired of being "just one of the bunch?" I mean, you sound like so many other critics on these boards.
By the way JC, you really should do more research before you open your mouth.
Let me explain.
Oil prices have been dropping strongly and are expected to continue lower. Oil stocks have also been going down but a few of those companies have some built in strength and are not likely to go much lower. In addition, oil has a "strong" chart support at 32.40 and having gotten down to 34.30 last week, further downside of consequence is not likely to happen without some kind of a bounce occurring.
As such, I started mentioning a couple of weeks ago that I want to purchase of a couple of oil stocks, more specifically CLB and EOG.
In this week's newsletter I gave 2 mentions to purchase EOG between 69.70 and 70.30 with a stop loss at 68.05 (which is 10 points below the lowest spike low point on the chart for the last 29 months and also represents 2 important spike high points from 2013. Objective is the $80 level, which is where the stock was trading at when oil was at $40, a level that oil can easily bounce up to on just short-covering. I purchased the stock yesterday at 70.32 and doubled up at 69.56. I am averaged long at 69.94. I am risking $189 per share to pick up $1004 per share, which is a 5-1 risk/reward ratio. Stock dropped down yesterday to 69.30 and is presently trading today at 71,12.
The same thing with CLB and for almost the same reasons as with EOG, but this is a stock that has actually been acting well in spite of oil prices dropping. I purchased the stock yesterday at 106.56 and have a 105.39 stop loss. The stock was trading last week at $120 in spite of weak-under-$40 oil prices so getting up to the level is a high probability. Nonetheless, the chart says this stock could get up to $135 with a bit of luck. I am risking $117 to pick up at least $1344 and possibly more. It is a 12-1 risk/reward ratio. Stock had a low yesterday of 106.09 and is presently trading at 108.87.
So, your saying I have "no clue" is ridiculous.
I forgot to mention that the probability rating I give to each trade is what makes me decide what percentage of my portfolio to invest in that stock. I never invest more than 15% of my portfolio into a stock at first trade but even then investing that much would only be done if I gave the trade the highest rating I give. That is not something that often happens. The lowest number I will invest in a trade is 5% and that is when I give a probability rating of 55.45. Normally though, my probability ratings are in the nature of 60-40 to 70-30, which usually means that I invest in the trade somewhere between 8 and 12% of my portfolio.
For your information, I gave the KNDI short mention a 65-35 probability rating and invested 9% of the portfolio into the stock.