>> I just wondered how others do it.
Hi Gottfried, re when to buy and sell. This is what I'm experimenting with lately. And it seems to work. Though that might be simply a random bit of good luck.
Looking at AMAT's 6-month chart, since last October, it has encountered buying (the so-called support) at
1- after dropping for several days (5 to 10 days),
and
2- dropping in price approx $4 (post split).
There have been six or so of these events. So there is some validity for considering them as "support" levels.
The next aspect of the model is what is more questionable. The idea is that if a recent support was breached, then the hoped-for support would be at the previous trough.
Then the last part is that if the company specific data and the macro-economic data, and the state of the world in general are now the same as they have been in the previous six months, then AMAT's price should stay in the same range, also.
OK, to get to specific numbers.
AMAT has three ranges. Going backward in time,
25 to 27.5
20 to 24
18 to 23.
To trade by this method, one has to be able to make at least 3 equal buys at 25, then at 20, then at 18. And perhaps one more at the September lows, just in case the world goes to hell, again.
For someone who bought at 24, there is a good possibility of selling at 27, since that level was reached on each of the last 3 up-swings. However since the 25 trough was breached, AMAT might be forming a descending triangle, where it will not reach 27, but maybe top out below that. It seems 26 would be a very likely bet. In any case, I think that wherever it reaches by tomorrow will be the top of this swing. The last few up moves were only 3 or 4 days long. And Friday is always bad, it seems.
Any way, it is all mumbo jumbo, maybe.
Regards, and good luck. By the way, I don't trade AMAT, but I use this method on ALTR, INTC, LSI and WDC. Seems to work.
Sarmad |
