%R spiked higher today...
But, in the past you'd see that sort of volatility that makes trading fun being paired with that %R spike, and you'd see the share price moving significantly higher than the prior days close with that minor spike. Sustain that, and it would give you a week or two of upside, probably testing the upper bolly before continuing the downtrend...
But, the more volatile moves MCP has been making in the last six months have been a function of having the %R and the OBV moving the same way at the same time. And, what you have right now is a minor spike higher in %R with the OBV moving lower by an at least equal amount... and the conflict between them suggests a couple of things... including a shift from support for upside volatility to a more muted upside bias, when the bias is up.... while otherwise indicating that the "conflicted" pairing likely means you should expect to see it be "contested" on any moves to the upside...
Look at the bottom it made in November, with all the metrics indicating the bottom in synch... including having a nice pinch on the chart... and that was readily trade-able. And, then, note the prior volatility also paired opposites in the extremes in CMF and the Money Flow Index... with pretty big spreads between them at bottoms, and dynamic moves closing the spread fueling the volatility both ways. But, what you see now is both those indicators sort of waffling around below the mean and drifting lower without much of a dynamic apparent, rather than drift... so, there doesn't appear to be much rocket fuel available to induce volatility, for now...
So, whatever the "market sentiment" is in terms of what people are saying about the company and its future potential... for now, their isn't an obvious pile of money that is saying "higher"... and there's not much to provide a proof of where the floor might be in a drift lower... if there isn't any acceleration into a new dynamic.
The big drop in November paired a correction of the reverse pinch with a dynamic move. The same chart set up exists now... with the last three trading days being a close parallel to 5, 6, 7 November. MACD crossed lower on Oct 31 and it took 2 weeks for a bottom to be found...
MACD again crossed lower on Feb 21... and the key difference this time is that the move in MACD isn't as accelerated as the prior instance. If %R and OBV weren't in such obvious conflict... you could expect to see an more accelerated decline developing already. And, if the %R reverses now, as it might, tomorrow, with the news of the day being digested a bit more... you might well see that situation again, with MACD rolling over more and making the trade a bit more dynamic... The direction of the % R and the weaker than previous slope pointing lower in the MACD and the bollies about the only thing holding it up, I'd say...
But, for now, what we do see is a more conflicted move... only without there being much energy behind it. That's still not a situation that makes me want to rush into a trade. "Drifting lower" is what is likely to result from having the more conflicted, or contested chart. But, whether the bottom that will be formed is "dynamic" like that back in November... or is instead relatively un-accelerated... I'll want to see a chart showing me something that is reasonably easily definable as a bottom...
With parallel bollies pointing down... that's not what I'm seeing...
The slope on the bollies now... half what it was in November ?
That seems consistent with the rest of what I'm seeing in the charts...
So, I'm not seeing a solid "price target" at a bottom that is being indicated by that dynamic... as you might see in a more accelerated situation.
I think you can expect a steady grind, from here... with MCP drifting lower over time and following the lower bolly... although with some added risk of a downside acceleration if there's a reason for the conflict in the market that is contesting the move lower now... to change...
Watch the %R. Even if you're day trading it... buying the bottoms in %R and selling the tops in %R would have been working for you over the last few months ? But, that trade would now have you underwater already after buying in on Feb 25... ?
If the dynamic trade in a decline might "shake them out"... the unaccelerated decline is more like an issue of "frogs in hot water"...
And, it looks to me like those are the options the chart presents, now...
Lower fast, or lower slow... |
