Hi MJ,
That was a short vacation! LOL!
SIRI's prospects look to me to be definitely improving of late.
139.142.147.218
Notice in the above chart the line across the tops of the stochastics has been broken to the upside. That is a very good sign. Here's another good sign:
stockcharts.com[h,a]daclyyay[dc][pb50!f][vc60][iLg!Lyb20,2.0]&pref=G
You can see in this chart that SIRI had tested the declining 50 sma unsuccessfully a few times, but at the end of April, SIRI finally found support at the 200 sma. Then at the beginning of May, the OBV crossed above its own 20 sma and tested that successfully. This was followed by SIRI moving up through the 50 sma.... another good sign. Now the 50 sma is just about horizontal.
All these things tell me a fundamental shift in momentum to the upside is occurring that bodes very well for the future of SIRI.
Now... that said, SIRI is currently overbought, since stochastics are above 80, and SIRI is probing the upper BB rail. Also, Williams turned down today.
So I suspect that in the very short term (1 - 3 days), SIRI will correct a bit, probably down to at least the middle of the BBs, if not to the lower rail. I think the most likely course will be that SIRI corrects only to the middle of the BBs, and finds support there, then rallies strongly and opens up the upper BB rail. Notice that the last time SIRI was turned away from the upper rail, it found support at the middle of the BBs. This is significant, and consistent with my interpretation above.
What I mean by that is that in an uptrending stock, typically the stock will cycle between the upper rail and the middle of the BBs (the 20 sma), so most of the time it will trade in the upper half of the BBs. With a downtrending stock, most of the trading occurs in the lower channel. In a stock that is not strongly trending either way (but may be in a definite trend just the same), most often it will cycle between the two rails, and the middle of the BBs offers little support or resistance.
So I think we are seeing the beginning of a new situation with SIRI where it spends most of its time in the upper half of the BBs, and repeatedly finds support at the middle of the BBs. Again, that is consistent with SIRI moving into a more strongly uptrending status.
So I see SIRI correcting to the middle of the BBs, and finding support there most likely. But after that, I think there is an excellent chance SIRI will blow that upper BB rail wide open, especially if the stochastics can cycle down to oversold range.
T |
