Ed, I try to find stocks that fit my technical objectives, with companies I'm familiar with, and have good liquidity.
Let me give you two ideas to help you time something with technical analysis.
Using stockcharts.com, when you see a chart that forms a hollow red candle, AT THE BOTTOM OF A TREND, it's usually a bullish reversal pattern.
I mentioned FLE to friends via e-mail the other day to show this example on using hollow red candles.
stockcharts.com[h,a]daclyiay[pb20!b10!f][vc60][iut!Ub14!Ua12,26,9!Lh14,3!Lc5!Ll14!Lj[$spx]]
It's important to note, the pattern is best used when it appears at the bottom of a trend. That was FLE's low!
On the other hand, black filled candles AT THE TOP OF A TREND, are usually good points to short a stock.
TOL is showing such a pattern after today's activity.
stockcharts.com[h,a]daclyiay[pb20!b10!f][vc60][iut!Ub14!Ua12,26,9!Lh14,3!Lc5!Ll14!Lj[$spx]]
I would have preferred that TOL traded a little higher today to clearly hit the high price in the recent trend, but I think you'll understand the concept.
These patterns are usually very good in short term trading, so you don't need to get greedy. Although nothing works 100% of the time, these patterns give you an excellent risk vs. reward scenario.
dabum |
