Miljenko & All: now that it has been a couple weeks since you posted about the lack of folks making calls about oversold/entry & overbougt/profit take points, I thought I'd point out some cases in this interval I called. Not to say "yeah me" but to show what you can do when you combine somehttp://www.siliconinvestor.com/research/chart.gsp?lotemp=&period=120&chart1=bb&s=ptix&compare=&time=day&i0=2&chart=bar&i1=3&scale=linear&i2=9&i3=8
simple, free TA tools (right on SI) WITH following the stocks involved for a long time on a fundimental & business
case basis.
I said on 6/8 that Regeneron was overbought and onlikely to jump from the mid 30s to 45+ (the option vulnerability point) by 8/3. I also asked about the prospect of material good news in that timespan (again, fusing both the business case and the TA)
Here's how it looked at the time
siliconinvestor.com
I don't look at just 1 indicator, as they give a lot of false signals. So here's 4. RSI > 70 is overbought, the higher, the more so. I tend to use 75 for safety. Stockastics > 75 is also overbought (I use 80). As these go 1-100, reverse that & you have oversold.
Bollinger bands - high or low, look for prices at or above the upper line for overbouht.
No when a stock is on an oversold or overbought basis, it can stay there for several days, sometimes weeks on a hot stock (not too often.)
Williams %r is an indicator of a stocks liklieness to retrace. Much more vollitle. With DMI, you rately see the green line above or below both the blue and red lines for long.
Note that since 6/8, it's underperformed the NAZ.
In contrast, on 6/19, I put in buys for ADIC (digital storage) and PTIX (networking) on 6/19 as they were both really oversold. I also have held these stock for most of the last couple years (stepped asside for a while when the NAZ went bonkers winter 2000 then rebought cheaper later)
I was confident based on my ongoing DD that there was no adverse fundimental news. I put in limit buys. Did not hit it perfectly. I bought PTIX at 11.8 (had been at 16 recently before that) it actually continued down to 10.
I put in a limit buy for ADIC at 15.20 when it was just under 16. Got a little too greedy. 15.30 would have bought. I posted on the ADIC thread that ADIC was oversold & that I was buying the before the open on 6/20. The PTIX thread is dead so I did not bother, but I have the trade confirm.
But they both have respectible rebound gains, and represent a good long term hold from the point I bought and neerly bought.
Here's the chart. About the inverse of REGN.
ADIC post with the chart link
Message 15968602
Here's the similar PTIX chart
siliconinvestor.com
I really think biotech investors that follow companies well arleady fundimantally can see additional gains by adding some TA to their bag of tools.
IMSCO
Scott |
