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Microcap & Penny Stocks : The Microcap Kitchen: Stocks 5¢ to $5

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From: lexi2004	11/19/2005 9:22:03 AM
	Read Replies (2) of 120406

Hi Gary, You are so sharing with your DD and so very helpful to all that I wanted to share this with you. Lexi =================================== Discovered something very helpful that I thought I'd share with anyone who is interest regarding projecting targets. Rule of thumb once a stock goes down and then retraces back up is that it will do 50% of that move. Of course not always exact, but at least gives you an idea. (Know this is nothing new to most of you - it gets better, so hang in there. LOL) So, using TRLG for demonstration for that is one I recently charted and found this example to be true.... Using a 6 month daily chart you can see that TRLG had a recent downward move from 9/30 to 10/27. That was from 17.21 to 11.11. If you figured a 50% retrace on that you would do this: 17.21 - 11.11 = 6.10 Taking 1/2 of 6.10 = 3.05 and adding it to the 11.11 (the low) the retracement would be 14.16 and that would be a good rule of thumb. Just recently I read that often times a stock retraces 50% of the PRIOR MOVE. So again with TRLG find the prior move. That was 7/25 down to 10/27. Using the same method: 18.25 - 11.11 = 7.14. Talking 1/2 of 7.14 = 3.57 and adding it to the low of 11.11 = 14.68. Look at the bounce on 11/05.....It's 14.69!!!! How much better can it get????????? LOLLLLLLLLL (It's not uncommon for them to pierce that line...hence the extra .01, but let's face it - how many of us would like to come within .01 of having a good target??) If you have a fib tool - this is a great visual and you don't have to do all the math. Either way, more and more I'm finding this on charts and it has given me an entirely different way to look/interpret charts. IMHO taking the time to find out the 50% retracement of the PRIOR move is well worth the time. I am amazed at how often it happens. Lexi

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