KB-
I'm wondering if charting really is appropriate in HC's case right now?
I believe that the fall off is event driven, i.e., a huge seller who needs to have 18mm sold by Friday. (We'll find out soon enough if that is the case). When will he be done?
It will occur when he is done unloading and that will be a finite event that occurs in a single moment. Will the charts tell us when that moment is to come? Will it be at 1:39 today or, 3:13 on friday? The charts may indicate when it occurred but, by then it could be way too late.
It cannot and will not forecast when the big seller will be done. Thus, I feel you should grab your opportunity (the baby's being tossed) when it's presented because when it is gone, we may have to chase the stock (and, Oh, how I hate that).
Candlesticking works, IMO, when there is "normal activity"(?), namely, when the combined sentiments of all the "regular" player's" action results in a pattern of behavior. Normal behavior usually has more subtle changes that TA can actually alert us to.
Secondly, it is important to realize my goal is to accumulate an investment position for the longer haul and larger gain. I am not interested in trading profits, per se, (though I've never pooh poohed them) because I am saddled (blessed?) by a 45% marginal tax rate. I prefer the 25% rate.
So, my first concern is "is this a good investment?" My second is "is this the right time (place in the cycle)and price to enter the stock?" Is it toppy or oversold? Thirdly, even if wrong, do I have enough liquidity to make it right?
IMO, it would border on arrogance (no, not yours)to think that relying on the chart to call the bottom, justifies spending 100% of one's targeted amount at that price, yet, if the chart read is accurate, one should do precisely that, right?
Who would?
I always work my way into a position, in pieces.
Now, I understand that the TA calls may be suited for short term moves and that traders might use it to scalp a few schekels here and there. The thing that it doesn't do, IMO, is tell you when the longer cyclical turn has been made. That can only be seen long after the fact, IMO.
Call me arrogant but, I think (guess is more like it) that this stock is at or, close to THE low.
Frankly, I don't believe HC will drop another 2-3 points but, if it does I'll add with a smile on my face. Mind you, I'm gambling that there is no boogey man in their closet.
(BTW, I think UCO is merely trading in sympathy so, I've added more of that name, today, as well.)
If you see one, you'll let me know, won't you? ....cheers. |
