>>> And in reference to your definitive statement above, I'd like to make a couple of comments...I know it's picky to point out, but dear ol' PTEN exceeded $20 only 4 times with a follow up retreat to $18. The 5th, last Thurs. made a new 3yr high above$20 on its close with increasing volume, and opened on the positive side Fri morning. Not to say that alone was a particularly bullish signal, but I seem to recall that when stocks make such horizontal trading channel patterns like this, that if they do break out to the upside, these patterns lend strength to the breakout move... <<<
Buck,
I used to think that too and sometimes they work out that way. However, the term "whipsaw" was invented to take advantage of those who bought into that theory which included me at one time.
The reason why a lot of people who use TA don't outperform those who use strictly FA any better than they do is because most people don't know how to use TA to identify "high probability" trades. These are the trades that have a high probability of success but also provide minimum risks.
Those who move the market are aware of the technicals. All of the brokerage houses and financial institutions have technical analysts. They know where you and I are motivated to respond. They will push the price one way to attract us and then sell into that strength.
I don't buy those breakouts anymore. I wait for the pull back after it has been established that the new trading range will hold. It's a higher probability trade with less risk involved.
The next price high for PTEN will be the one that provides a better reward to risk ratio or buying off of the 20 day moving average, provided one uses good stop loss guidelines. Those guidelines being that one sell if the price drops below the 50 day moving average.
stockcharts.com[h,a]daclyiay[d20041108,20050208][pb50!b20!f][vc60][iut!Lah10,30,5!Lc20]&pref=G
All in my opinion of course and one keeps in mind that my time frame is short term.
dabum |
