Thanks for your analysis, Arnie. I took another look at the chart, and I see that volume has been fairly consistent all the way back to $9.00 a share in August, the last time a million shares were traded on a high-volume day. It is true that if average daily volume is about 100K, then there have been only 2 days since August where trading volume passed 500K shares, but I wouldn't interpret the chart as volume drying up. Am I missing something?
Also, the fall off in the past 3 days, when the E.coli stories first came out, has been pretty steep, with slightly higher than normal volume, so I still think this may have been a factor. It doesn't always take volume for a stock to move up dramatically; yesterday 2 of my stocks jumped up about 2 points each (over 10%) on much lower than average volume. I've given up using absolutes to determine where stock prices are heading in the short term.
You disagree with my reasons for the pullback, but do you think this is a good entry point ($9ish) to add to my position? I took another look at the chart and discovered that there was a significant pullback just after the 5/1/96 2Q earnings release, then a much bigger pullback (from $9.00 to $6.25) just before the 7/24/96 3Q release. If the pattern from the last quarter is being repeated, then it seems likely that the stock has hit bottom, and will continue heading back up from here, especially if the earnings report is positive.
D. Kuspa |
