We've had at least 7 shakeouts since the first of the year. It was getting really old a few shakeouts ago. Now, it's getting really, really old. Isn't that what shakeouts are supposed to do? They get you to sell. Has AT&T decided not to spend all that money over the next three years? I don't recall hearing that.
Has JDSU risen to lofty levels over the past 3 years? No, basically it's been in a $9 to $15 trading range. It did have that short-lived spike up to $29 in early 2011, but mostly it's been trading in the $9 to $15 range. I guess we'll all see what happens after their next earnings report.
Where are we today? We've been in a classic point & figure shakeout formation. The buy signal comes when you get the 3 box reversal on the column of Os and switch to a column of Xs. That happened today when we went through $14. The column of Os extended down to the bullish support line. at $12.50.
We're in a classic shakeout pattern on a point & figure chart. The pullback has now extended to the bullish support line. CIEN has also pulled back to their bullish support line. It's hard to believe, but this is actually a bullish chart pattern.
We're in a classic shakeout point & figure chart formation. We're currently in a column of Os. One could make an argument for support at 12.50. That keeps JDSU at its' bullish support line. It may go there, then it might just stop going down before then. The shakeout pattern is a bullish one, so when momentum changes it will move fast to the upside.
Just because it's happened before doesn't mean it's going to happen this year. Did AT&T talk about thier plans in 2012? Did they talk about their plans in 2013?
This is just the latest in a series of 5 shakeouts for JDSU in 2013. The very first one was when Cramer said he liked JDSU. Then we had a big one prior to earnings. Then we had another one on CIEN's earnings. I believe we also had one on some analyst comments. This latest one is a classic shakeout using point and figure charting. It's a bullish pattern if you know how to trade it.
Don't you think 5 shakeouts in a three month period sounds like a good foundation for a nice run to the upside?
With JDSU just going below 13.50 it gives a sell signal on a point and figure chart. We put in a double top at 15.50 and the 13.49 puts in a lower low than the last time we pulled back in February.
It sure seems like it. Anything they can do to shake you out of your shares. Just like the post "Cramer likes us" sell off, the pre earnings shakeout, etc. I guess that what it takes to get this thing to spring loose - repeated shakeouts for no reason.
We finally went through $15.50 three weeks ago. Run any chart you like and see what it tells you. I happen to like point & figure charts becasue they eliminate a lot of the short term noise. If you took the name JDSU off the chart, you would be laughing at what any easy long this is.
I really don't think FNSR and CIEN's quarterly results matter. The telco spending is real and will happen if not this quarter, then next quarter and in the foreseeable future. That's why JDSU went through 15.50 3 weeks ago and put in a 52 week high.
We've had 4 pullbacks already since Jan 1. We had: 1) the Cramer likes us pullback, 2) the ridiculous pre-earnings shakeout, 3) the strong resistance at 15.50 mini pullback, and finally 4) the we went through 15.50 pullback that we're in now.
It's probably the same shorts, institutions, or just individual traders involved in each one of these. If you can withstand the annoyance, it just adds fuel to the fire for the next move up. Remember on a pre reverse stock split basis, we're only trading at 1.77! So, we've been taken down from $150 to $1.77 over the past 12 years. Actually we went down to about $0.25 at one point in 2008 or 2009. We spent a lot of time trading between $2 and $3 in the mid 2000s, so that would be $16 to $24 in today's price terms. Just a little historical perspective helps keep your sanity. So, if we get a quick double from here, it's no big deal and it really should happen anyway.
Yes, it's just a matter of how much it pulls back. Since January, we've already had three: 1) the Cramer pullback, 2) pre earnings shakeout, and 3) now this one. If you look at a point & figure chart, however, the risk is obviously being on the short side.
For the past 2 weeks JDSU has been in the penalty box. How much longer before they let it out? It's really not surprising that it goes through that 15.50, puts in a 52 week high, then it gets taken down almost immediately. If you can withstand the pain of this really annoying pullback, it actually is a good thing for making a run at 16, then who knows how much higher. It's almost better than if it just floated around 15 to 15.50. At least there are plenty of shorts that will cover and people who sold with the intention of buying back in having to do so.
So we go through the 15.50 level and ever since then we get this orchestrated pullback to 14. That's a 3 box reversal to a column of Os on a point and figure chart. As my original post said it's really annoying. But that's what it takes to generate enough momentum for the next move to the upside as the shorts cover and those who are panic selling buy back in.