My previous post "Chart Outlook - Rest of the Week" shows 2 pans (down fingers). It really doesn't bother me at all but I don't understand why anyone would pan information. What I stated in that post was not an opinion, it was simply information on what points on the chart are important and why they are important. Let me once again state "it was NOT an opinion, just information!!!!"
Panning information is like saying "I prefer stupidity and being in the dark". Please help me understand why anyone would want that?
KNDI will be trading around the 6.51 level today and tomorrow with a small possibility of getting up intra-day to 6.93 or even 7.25. The 6.51 level is a weekly close resistance of some importance (though not major pivotal) that if broken would likely stimulate further upside to the 8.25-8.50. If not broken, and the stock closes at or below 6.51, a drop back down to the 5.00 could be seen before the bulls attempt to reach $8. As such, on a short-term basis (today and tomorrow) it will likely be seen repeatedly with the decision made tomorrow on the close.
Nonetheless, overall, the probabilities are high that for the next 3 months the stock will trade between $5 and $8 or maybe $5.50 to $8. The 200-week MA is currently at 8.25 and there is a major spike high from April 2013 at 8.50 and neither of those levels is likely to get broken without a successful retest of the 5.05 low or a positive fundamental change (which has not yet happened).
The only decision likely to be made tomorrow, is whether 8.25-8.50 or 5.00-5.50 will be seen first.
Please be aware that the 200-week MA is an important long-term trend indicator that will NOT get broken without a positive fundamental change, or a lot of chart base building done first.
Thanks for the explanation but it still did not give me a "chart" reason for your comment.
Nonetheless, I agree with you totally. I put out a buy mention on KNDI a week ago Sunday to purchase the stock "as close to 5.00" as possible and did buy the stock at 5.07. The objective of the chart analysis was a rally up to the 8.50 level and ultimately (by the second quarter of next year) to 11.30.
Nonetheless, my chart evaluation had nothing to do with Icahn buying or with large buy orders. I certainly understand why those buy orders are being seen as a stock does not drop from 22.50 down to 5.00 without some decent bounce along the way, unless of course the company is fundamentally heading to bankruptcy. I have not read anything that suggests that is happening.
By the same token, some of the buying could be "short-covering" rather than "new" buying, but that is not something I am truly interested in knowing.
Chart is clear that the 5.00 level is support and resistance is found at 6.75/7.25, at 8.50 (previous intra-week high and where the 200-week MA is currently at), and at 11.30 (previous low weekly close support level that got broken, that caused stock to drop to here).
Excuse me for being "picky" but anytime someone says "hitting breakout resistance now if 6.05 hits we go to 8.50", what I want is a chart explanation as to why 6.05 is "breakout resistance" and why the chart says we go to 8.50.
If you would be so kind to explain, I would appreciate it.
I have been a chartist for 38 years and I see no "breakout resistance" at 6.05 and though I can see why you say 8.50, it is certainly not a high probability as there is decent resistance at 6.75 and 7.25.
KNDI made a new 2-year low at 5.05 but the bulls were able to generate a bounce to close near the highs of the week, suggesting that further upside above last week’s high at 5.77 will be seen this week. Nonetheless, the bulls failed by 5 points to generate a positive reversal (green weekly close), suggesting that a bottom may not yet have been built and that after a bounce the stock may return to retest the recent low or even get down to the 5.00 level. On an intra-week basis, very minor resistance is found at 6.10 and at 6.38 and minor to decent between 6.68 and 6.75. On a weekly closing basis though, minor to decent resistance is found at 6.22. Probabilities favor the stock heading up intra-week to 6.75 over the next week or two but then falling back to retest the recent lows.
I tried to put up some chart comparisons but Yahoo did not allow me to put up the link to where I uploaded them.
Nonetheless, I would like to "re-state" that even though the stock is not sensitive to the indexes on a 1-1 basis (or consistently), under certain circumstances it does react to what the overall market is doing.
Check out the charts of the DOW and of KNDI for December of last year, August of this year, and at present and you will see what I mean.
Enjoy your trip to Disneyland. I hear they have some wild rides, one of them being "KNDI trades all on its own"
If I had a penny for every time that has been said to me over the past 37 years, I would be a millionaire.
All stocks have some tie in to the indexes as the indexes often signals the "mood" of the market.
This is especially true when a stock is overdone in one direction or the other as the traders are looking for "anything" that will help them determine direction for the short-term.
Keep in mind that these days so much is done with computers and algorithms as they are set up to make changes when the mood changes. As it is, price levels are subjective (meaning, what is the fundamentals difference in KNDI if it is at $5 or at $6?), that computers will often buy or sell depending on what is happening to the overall outlook of the general market.
Today is a big major pivotal day for the indexes and they having now seemingly disregarded the very negative Jobs report, it does suggest that if the bulls are able to make it "all happen" on the close today, that the mood will shift toward an end of the year rally and KNDI would not be adverse to such a rally, at least for a move back up to the 7.50 level.
That is the reason why watching the indexes is important even in a stock that is not directly related to the indexes.
Hey, I have been doing this for 37 years and did it officially as a chart analyst for 3 major brokerage firms in the 80's. As such, I have some experience in this kind of chart evaluations.
Based on a study of the weekly chart, going back 10 years, KNDI is now going to show decent to perhaps even strong weekly close (Friday's) resistance at 6.20. By the same token, the 5.00 level on a weekly closing basis is also considered support, though not as strong as the resistance is.
If the indexes do rally today after the Jobs Report (keep a close eye on the DOW and the 16350 as it is pivot point resistance), the probabilities will favor KNDI turning around over the next week or so and if it does, the 6.20 level (based on a weekly close) will be the main objective of the bounce. On an intra-week basis, the stock could rally up to 6.75-7.25 and even possibly to 8.50, though a rally up to 8.50 is going to be harder to accomplish and likely will depend on positive fundamental news. This is not to say that further upside later on (like next year) cannot be seen, but getting back up to 6.20 is a high probability if the stock does not break below 5.00 on a weekly closing basis.
In fact, the probabilities favor the stock trading between 5.00 and 7.50 for the next 4-8 weeks. .
I do see on the charts the possibility of the stock getting back up to the breakdown point at $11 within the next 3-6 months. Nonetheless, let me say that I am a "trader" and by nature do not stay with positions for the long term. I play peaks and valleys and even if I miss an opportunity I usually have my money working somewhere. As such, no it would not bother me if I get out at $8 and it goes higher.
By the same token, as long as a stock is not giving me any signals to get out (be it a top or a pause), I normally let my profits run so that means that I won't get out just because a stock reached one of my targets.
Per my newsletter mention, given here on Monday, I purchased KNDI at 5.07. Objective is 8.20 and stop loss presently is at 4.02, meaning that I am risking $105 to pick up $313, which is a 3-1 risk/reward ratio.
Nonetheless, I cannot envision staying long KNDI if the stock starts trading below the bottom of the $5 demilitarized zone at 4.70, meaning that the risk/reward ratio is better than 3-1.
From the comments I have read here at the board, it seems most of you think this stock is a POS. Nonetheless, message board comments usually favor the trend and this stock has been on a strong downtrend. The chart strongly suggests that the 5.00 is important and pivotal support and as such, I have to follow the chart, especially since the charts also suggests that the index market is likely to head higher from here for the end of the year rally and with this stock having traded as high as $22 last year, the oversold condition is such that any little bounce will probably bring in a strong short covering rally.
It is important to note that already today the stock generated a spike rally, having been up to 5.59, which is above yesterday's high and that also suggests that the possibilities of a strong short-covering rally that would take the stock up to the 7.50-8.00 level are high.
KNDI Friday Closing Price - 5.77
KNDI is another stock that has suffered greatly due to the big drop in the Chinese market, having seen a high of 22.49 in July 2014 and now trading below the $6 level just 15 months later. The stock has seen a total of 7 months in a row of red closes but also 11 out of the last 13 months, meaning that the stock can be categorized as oversold and likely overdone to the downside.
KNDI closed on the low of the week last week and further downside below last week's low at 5.76 is likely to be seen this week. By the same token, the probabilities also favor the low seen 5 weeks ago at 5.55 being broken and a fast move down to the 5.00 to occur.
Nonetheless, KNDI spent 29 months trading below the $5 level (between Jan 2011 and June 2013) and when that level was broken to the upside the stock got into a 9-month rally that took it to 22.40, suggesting that the fundamentals of the company need to be truly negative (not just the Chinese market falling) in order for the $5 level to be broken to the downside after such a long downtrend. As such, it does suggest that a purchase of the stock as close to the $5 level as possible is likely to generate a profit even if the Chinese market heads lower.
To the upside, KNDI shows decent intra-week resistance between 6.75 and 7.25 and a bit stronger at 8.50, that does include the 200-week MA, currently at 8.25, and that is highly likely to be seen if a short-covering rally occurs. By the same token, the monthly chart does suggest that at some point in the future (perhaps over a period of 6 months) a rally back up to the weekly close support level at 11.31, that held up for 18-months between December 2013 and May 2015 but when broken caused the recent move down to this level, will be retested, meaning that even though the mid-term objective of the trade is only back up to the $8 level, on a longer term basis the stock could bet back up to $11.
The stock "needs" to generate a spike low off of this news in order for the traders not to get additionally negative on the stock. The did close just slightly above the mid-point of the day's trading range, opening the door for the possibility of it being a spike low. Nonetheless, the same thing needs to happen on the weekly chart, and that means a close tomorrow (Friday = weekly close) at 2.90 or higher needs to occur as the stock is showing a $2.08 trading range this week (3.90 to 1.86). If all of that happens, the traders will likely get on board as this move down looks "way overextended" and unlikely as well.
AREX made a new 6+ year low weekly close, below the one seen in December at 5.16. The stock closed on the lows of the week and further downside below last week’s low at 4.97 is likely to be seen this week. The stock has now had red weekly closes on 10 out of the last 11 weeks and there seems to be no end, chart-wise or fundamentally, to the weakness being seen. The all-time low weekly close is at 4.64 and the probabilities are high that level will be seen this week. On an intra-week basis though, the intra-week low seen in December was at 4.28 and it does seem unlikely that level will be broken at this time, meaning that consideration can be given to purchases of the stock around the 4.64 level with a stop loss at 4.18. If that support level holds up, the chart suggest a rally up to the $10 could be seen in the coming months. It should be mentioned that 3 weeks ago the weekly volume dropped under 300,000 for the first time in 9-months and was the lowest since June 2014 when it got down to 209,000. In November when the stock got down to 4.28, the volume had also been dropping and just 3 weeks before the 18-week uptrend to 9.57 began, the volume dropped down to 389.000 (which had been a 5-month low since June). It should be mentioned that just 3 weeks ago the volume dropped down to 289,000, and if past volume history is any indication, it could mean that a turn to the upside might be right around the corner.
I purchased additional shares at 45.31. I am now averaged long at 43.92 (2 mentions).
Stop loss on the positions purchased today is at 44.08. Objective is 51.50 so I am risking $123 to pick up $619, which is a 5-1 risk/reward ratio.
SINA generated further downside this past week as the sell-off/correction from the recent highs at 61.25 reached 32%. The stock did close the original breakaway gap at 41.90 that was created the day it was announced that the CEO was buying $465 million of the common stock, meaning the gains seen because of the CEO purchase have been erased. Nonetheless, a strong short-covering rally was seen immediately thereafter, causing the stock to rally up to the psychological and previous intra-week high resistance at $50 before settling down to close slightly in the lower half of the week's trading range.
The future direction is likely to depend on what the Asian markets do now (after their major fall), but the stock has reached a level of support between 40.44 and 41.90 that is likely to hold up. The stock did close near the lows of the day on Friday and further downside below Friday's low at 45.25 is likely to be seen on Monday, probably with the objective of closing the gap that was created on Wednesday at 45.02. Support is likely to be found between 44.18 and 45.02 and a rally back up to the $50 level (probably up to the 51.70-52.77 level) is likely to be seen.