Hi Charles, Re: Accumulation/Distribution of SUNW............
I don't use Accum/Distr. by itself. Actually I only find it of interest as an affirmation of what I'm doing with my accounts. Yes, the period being used can rather drastically change the appearance of the line. However, if one uses it consistently with the same settings over a broad array of stocks, one can gain some value from it.
Here it is indicating that the trade volume has, for quite some time led to lower closes indicating distribution. As an example, one could put the ticker of an energy related stock in, and using the same settings, see quite a different pattern! Most other technology stocks have had flat or choppy Acc/Dist lines where Sun has been declining for quite some time.
(here's the graph we're discussing:
stockcharts.com[h,a]wahlyyay[df][pb26!e30][vc60][iLk14!Lf14]&pref=G
It's nice to see it attempt to cross over the 14 week M.A. line as it's doing right now. It's also nice to see W%R heading higher on that portion of the graph. My investment model usually has me selling off small portions of my holdings when such things occur. It, on the other side of the coin, has me buying when the W%R and Acc/Dist lines are heading lower. Again, these statistical measures are not the driving force on my decisions. The buy and sell decisions are derived from a mathematical formula (called AIM). These "technical" measures usually coincide with the AIM program's efforts. AIM buys into weakness and sells into strength.
I view this data on a weekly basis since that's the review frequency of my program. If I were to switch it to "daily", then there's not much correlation to what I do. (more noise, hence less value for me?) So, yes, it is only as a curiosity to show it here on a weekly basis. I do think if there is a basic shift in how investors view the stock, we will see this weekly data shift to the positive side of the Accumulation/Distribution line.
Hope this helps,
Tom
PS: I sold my first small block of SUNW at $4.45 yesterday. I only just started this investment in Sun about 8 weeks ago, so it's a bit soon to know how happy it will make me. |
