Hi Jim...nice call
I've always known there was something to those linear regression channels, now I just have to figure out what it is<gg>
I'd like to see your optimistic price projections come to fruition. At this point I'm still a bit skeptical, though I am turning more bullish with the passage of time based on the possibility of a nice healthy pullback for entries into some intermediate long position trades...this stock included.
FWIW it seems that we may have put in a bullish reversal pattern that forms with three consecutive long white candlesticks..."Three White Soldiers"
stockcharts.com
This is a pattern that has shown up in a number of stronger stocks across the board, including this one.
A few caveats though...one from stockcharts weekly commentary
I feel it is always crucial to include volume in your analysis of any stock and the CMF combines price and volume in a particularly useful way. Again, since we are searching for good short-term reversal candidates, I'm looking for a CMF that has just turned positive
You will see that Money Flow (CMF)has been trending down and diverging with price on this chart, and is about to go negative here, this is very often a precursor to a trend change...
stockcharts.com[h,a]daclyymy[dc][pb50!b8!d20,2!f][vc60][iUb14!La8,17,9!Lf!Lh5,5!Li5,5!Lg!Uc20]
Also, on a relative strength basis, this has been an area of big resistance in the last 6 mos.
This rally is very similar to the Jan. 2001 rally...same 3 white soldier bullish candlestick formation, same breakout over the 8 DMA, same overhead resistance at the 50 DMA... same market conditions where everyone was calling the bottom in stocks.
In regards to the all important 50 dma; I learned a couple important things after the last Jan. rally...
1)when a stock breaks out over the 50 DMA, that moving average is not considered to be strong support UNLESS it has turned upwards...ESPECIALLY in bear market applications.
2) don't chase and be patient, this stock has actually moved faster than it did in Jan., and is ready to break out on the 20 period bands, so if the market is setting up in a bullish consolidation here, it should pullback, just like this stock did last January. That would be the buy opp. for me anyway.
3) On micro small cap penny stocks if you hold very large positions, you need high volume to sell into effectively to unload and make money, these opportunities don't come often and when they do they MUST be capitalized on, otherwise you are stuck with large blocks of stock and no volume to sell into.
There's other things here that could support a bullish argument, your indicators included. Maybe Dr.Markman stepping down, or getting pushed out, is some sort of catalyst for change. I'll be the first to admit, short of bankruptcy or re-listing, it didn't seem like things could get much worse<gg>
I'm still long term bearish on the market until the bigger pictures prove otherwise, so it doesn't matter to me. These are all little waves of opportunity...up or down. Thanks though for the insight and the great call... I'll continue to watch closely.
Best Regards, and best of luck with your trade.
JM |
