My advice to him (not you) was that if he placed a bet today I don't think it would've been a bad one because most of the charting indicators I used said this is a buy with the exception of the RSI.
DMI+/- crossed today on higher than normal volume. ADX has rolled over. But RSI is not at oversold territory...it's around 50 which is normal. If you entered today I don't think you made a bad decision. Just know with RSI at normal it can still go lower. Keep an eye on the 3 year weekly chart also. That will be the best indicator if you're in this thing for the long haul. RSI on that chart is fairly low. After this week it'll be likely that the DMI+ on that chart will begin to head upward which may potentially stabilizing the upward trend of the ADX to around 45.
Like I said, I purchased 10000 shares and the stock went from 0.67 to 0.76 (closed lower). Then after Moody's, S&P and other analysts downgraded the stock, it started trending lower. This is all a fact, I'm not asking anyone to believe me. I've grown unbelievably tired at all of your criticisms (particularly you casadipace and jojowhatever) even after I've been doing this out of kindness. What you guys consider voodoo is actually your lack of understanding of charting. There are many books published on the topic. I would highly recommend you read them. But it's obvious that my charity on these posts is not welcomed or appreciated. Therefore I bid you all farewell and good luck, this will be my final post.
Good luck to you in particular nomadinx. My advice to you is don't make decisions too early. Wait for the DMI+/- to cross on higher volume. This will be the best entry point. Of course, as long as Portugal Telecom doesn't throw another debt bomb into the equation! Later buddy.
ADX began rolling over. DMI+/- was crossing over on higher volume. RSI was less than 20. Shortly after the purchase the stock went up 10% but collapsed after Moodys, S&P, etc... downgraded Oi due to the PT/RioForte transaction.
How many times do I have to repeat that I purchased the stock before the PT/RioForte scandal? I bought it because the DMI+/- crossed with DMI+ on the rise, the ADX rolled over, RSI was low, volume was high. I actually made money up until the scandal occurred. After that the charts completely changed course.
On a micro level yes. If I was purchasing a business that I physically possessed, I would consider all of those aspects prior to purchase so as to make sure the business functioned at a sustainable profit. However, when you factor in hundreds of millions of other potential owners, the game changes. People change ownership of the company every day. That amount is quantifiable.
If it were predictable that a stock like Apple which has no debt, tons of cash, and a great business model were to go up in value based solely on its financial statements, then why does the stock price drop at times if its so predictable? The answer is that it's not predictable based solely on financial statements. It definitely is 4 times of the year when earnings are released, but in between that time the game is different. This is where charting can be used to help an investor make a "calculated risk". Charting is by no means perfect, and like I've experienced with OIBR, you can still get burned when things like the PT/Rioforte scandal occur that charting can never predict. But moreover, charting has given me the confidence to look at patterns for better or worse and treat the stock market like a game that can be played and can be won.
I have no idea what would happen should the merger fall through. Whatever the case, I would expect a significant move in the charts.
Please don't take this the wrong way or anything, but your argument has nothing useful to provide me. It is apparent to me that you have no idea how charting works and you don't wish to learn because you seem very set in your own ways. Why do my posts bother you so much that you feel the need to try and rip apart anything that you don't understand? If your way works for you then great. Post a topic on here and share your thoughts with people if you wish.
Also I think I have been very fair on sharing my information. Even though I own the stock I saw patterns that suggest it wasn't heading upward after the PT/RioForte scandal and I shared this information with folks here that may have looked at the scandal as an opportunity to get in low. Since then the stock has dropped over 20% and I saw patterns in the charts that suggested this trend.
We speak the same language, nice! So you entered at .55? I still would've waited for DMI+/- to cross no matter how long it took. But you're right, negative is around 33 and positive is around 8. That's a huge void to fill which is why good news is essential.
I don't know. Maybe because it's a Brazilian company and not an American company? But then again Brazil's Ibovespa Index was also up today. Sorry I don't have the answer to this.
DMI- has not touched the ADX in a few business days. This is good news. ADX is around 45 and DMI- is around 33. Unless the stock price tanks, I don't see the DMI- or ADX crossing anytime soon. This is a good sign and it may be the indicator that we've hit bottom or close to it. Moreover, the DMI of the 3 year weekly chart and the 1 year daily chart look similar in pattern. This is another good sign. 3 year the RSI is around 18-19 which is fantastic, but again I have no idea how the merger will effect this. The 1 year RSI is around 30 which is alright. The stock just needs something good in the news to reverse the pattern of DMI- and DMI+. The next few weeks will be pivotal. I will let you guys know if I make any trades.
Once again I'm glad that your method works for you. If you actually gave specific details as to why charting via DMI, RSI, ADX, volume, MACD, etc., we're incorrect then I would actually be willing to listen to what you have to say. Instead, you're attempting to discard the whole study of charting itself simply because you feel that your way is the correct way. It's almost as if you're offended by the method. When it's your criticism vs my 500% gains, I'm going to go with the 500% gains because only one of those options will make my life better.
No I was not saying cause and effect. I was saying that positive news was needed, however since the activities of the merged company have not been transparent to their investors (Portugal Telecom not disclosing a massive $1.2 billion bad investment) it is difficult for investors to place their trust in a company which has deceived them in the past. I'm not saying I'm right. Frankly I don't even care. I just follow the charts. DMI- is above DMI+ and below ADX. RSI is low. I see no reason to sell nor buy. My theories as to what could change the patterns are just speculation.
Hey I want the stock to go up just as much as you do. But I leave praying and hoping for spirituality, not the stock market.
Interestingly although the DMI- has been on the rise it still hasn't crossed the ADX like it has been doing for the past 2 weeks. This is because the ADX has also risen to yearly highs. All the stock needs is a good dose of positive news to reverse the upward trend of DMI- and downward trend of DMI+. But I personally don't see that happening. If I'm not mistaken, Portugal Telecom's former CEO Zeinal Bava is now the CEO of Corpco? Perhaps this doesn't make investors feel secure as Portugal Telecom deviously threw a $1.2 Billion debt bomb at Oi shareholders. That's like a parent that bails his alcoholic son out of jail after the son got drunk and totalled the family vehicle. And the money used to bail him out was taken from the responsible older brother.
Anyways, the chart is not telling me to sell it nor buy it. It looks like things may get worse before it gets better.
This method has made me quite a bit of money thus far. What makes this stock particularly of interest for me is that I own the stock. I typically play options and using my calculated risk method I've made quite sizable profits. Since OIBR is already less than a dollar I decided to purchase the stock outright since the options were a mere $.50/share more than the actual option price.
This method does not try to predict the behavior of people. It tells me as an investor when the stock is valued at a price point which is suitable for purchase. If you take a look at Brasil Foods (BRFS) I purchased options in February at a strike price of $17.50 for $1.25/contract. I sold my contracts at just under $6/contract. Why did my method work? BRFS is globally a leading producer in poultry. Did millions of people stop eating chicken in February? Did they eat more chicken in July? I have no idea and I don't care. I just follow the charts.
Look I'm glad you're method is working for you. I already explained that I'm not trying to convince anyone to do anything. I thought I was being helpful by posting this. A grumpy old man I work with named Bill taught me charting. Bill didn't ask for any thing in return, so I just thought I would pay it forward since it's done well for me.
The drop today confirmed the DMI- on the rise. Like I said before, when the DMI- flirts with the ADX it's not a good sign. If this trend continues I will take my losses and move onto the next play. For those of you in this long term the 3 year-weekly chart is looking decent. The ADX is on the rise while DMI- is dropping and DMI+ is increasing. The most likely catalyst for a DMI+ and DMI- crossover i can see will likely be the positive merger news.
If you all don't like my posts please say so and I will stop. I'm taking time out of my day to write these from my mobile device (I work outdoors) so I don't want to be wasting anyone's time or my time.
Yes I have lost money in terms of stock value but I have not sold it yet and I'm waiting for the opportune time to potentially double down. Perhaps you didn't read my posts? I'm glad that simple method works for you, but sorry its not for me.
Take a look at a 1 year chart from Bank of America...(I hope the link works)
Look at what happened in late May. DMI+ and DMI- crossed while the ADX rolled over and created a peak. What happened to the stock several weeks following that event?
The stock appears to have risen $1.50. This crossover occurred on higher volume and a lower RSI. This is an example of how this method produced a gain of $1.50 per share. Take a look at any other stock for this method (it doesn't work well for low market cap stocks).
Explaining everything in detail about the mechanics would take me forever to explain and I don't have the patience for that I apologize. I'm also writing this from a mobile device making typing that much more difficult. Just to clarify there is no such thing as someone with a crystal ball that knows exactly where a stock price will go. The absolute best strategy I have found is taking a "calculated risk." Of course no calculated risk is bomb proof as evidenced by OIBR's performance in the past month. Calculated risk also has an Achilles Heal...news that moves the stock. The human element of every stock is always drawback of this method. It can make the stock unpredictable. But in general I will find this method working 3 out of 4 times. Unfortunately, Portugal Telecom throwing a $1.2 billion time bomb at OIBR reversed the uptrend very quickly and for good reason. But as I said before, I don't put emotion into stocks, not even this one. I look at the charts and do what they tell me, regardless of external factors. When the human element enters the picture I still stick to my strategy. It has done my portfolio well thus far.
Update: DMI- was on the fall up until today. I was really hoping there would have been a modest rise in the stock price that would continue the trend of DMI- downward but it didn't happen. If the stock price continues to drop I would still advise not to purchase the stock. If it goes up though there will be a good chance that the DMI- and DMI+ will cross over which is the primary indicator I use for a buy signal. This is occuring at the same time the ADX rolls over and creates a peak in the chart. If the crossover occurs on higher volume then this helps me confirm the move. At the same time an RSI below 30 would also confirm the move, but lower than 20 would give me far more confidence. The RSI is around 35 right now. We'll see what happens s in the next few days.