Cacaito,
GET includes primarily Elliot Wave analysis and makes heavy use of Fibonacci numbers in this analysis. It also offers dozens of other TA "tools" that I/ve mentioned before. On a PURELY Elliot Wave(EW) analysis, VVUS is is wave 3. The height of wave one (7/16-7/25) is used to figure probable wave 3 low. Since wave 1 is completed, these estimated lows dont change as long as wave 3 continues to form. GET says there is a 75% probability that wave 3 will end between 21 1/2 and 16.
Sixty percent of the time, the wave 4 retracement after wave 3 is completed will retrace 30 to 50% of the wave 3 height. TODAY, figured off of VVUS's intraday low, a 30-50% retracement would be 27 1/8 to 27 7/8. If, and as, VVUS keeps declining in wave 3, this estimated wave 4 retracement will change daily until wave 3 is completed. So, if VVUS reversed tomorrow, about 28 would be the high before it starts down in wave 5.
Get offers total flexibility in constructing Gann lines. Two differently constructed sets of Gann lines look to me equally correct. One shows VVUS approaching strong support at 22 5/8, which is also at VVUS's 200DMA. The other indicates VVUS hit support today. I wish I knew more about constructing Gann, but I dont. Best guess is that VVUS could end wave 3 at 22 1/2 and start its wave 4. Again, this has nothing to do with EW-- GAnn is just a great tool in the hands of those that know what they are doing--and that doesn't include me yet.
Also totally separate from EW, the linear regression channel's upper limit is also at 28, the parabolic SAR that was 30 3/4 last Thursday is now at 29 7/8 and will come down daily even if VVUS goes sideways. So, would say that if VVUS breaks 29 quickly, and EW say its no longer in wave 4, then it could be considered a buy--with the caveat that I would have to update the TA at that time to make sure.
The 2 most successful trades in GET are: 1. Selling at the end of a wave 4 retracement in a declining stock like VVUS (conversely, buying at the end of wave 4 in an advancing stock) and 2. Buying at the end of a wave 5 decline (or selling at the end of a wave 5 advance) So, I would sell short if VVUS retraced now to~28 and turned back down. I wouldn't buy till the end of wave 5 and that's too far away to even guess about now; or if VVUS were to decisively break out of wave 4 somewhere above 29.
Hope this isn't too hedged--you seem to want a simple buy or sell answer and GET gives you the best tools to try to figure it out, but it doesnt totally do it for you--a lot if interpretation is required, and that still involves probabilities. Even if you had an 80% probability--which are excellent odds, you would still lose 1 out of 5 trades.
If your TA was way too late to catch VVUS at its $30 low last May 13, (not April), maybe you should use different TA.<ggg> Click on Rubbles referenced post of mine on 14 May--I specifically said technically VVUS was a buy then--at $30.
Regards,
Gary |
