JPM: We obviously disagree about the efficacy of 10, 20, and 30 day moving averages.
Moving average? The whole concept of a "moving average" is to capture a stocks movement over "the course of time." 10, 20, and even 30 days falls far short of this concept. In my opinion, reasonable minds could differ as to a 30 day, but below that they're absolutly useless.
Why a buy signal? Because the 50 and 100 day moving averages are about to touch at ~57, which can cause a the stock to turn around rapidly.
Volume? Yeah, I noticed that today too. That's pretty good, mainly means that any large positions have been unwound and it is "safe" again to buy. In fact, with the stock so beaten up--for reasons that are far from reasonable--it could resume the 60s climb quickly.
TA? Just a quick response to what you termed "tried and trusted" TA method. Again, I want to point out how unconvincing the "cross" of the 10 day moving average with the 50 day is--this happens all the time of stocks such as CSCO, USRX, PSFT, ORCL, and other volitile players. Yet if you had reacted to the crossing you would not be richer.
While TA can be useful I should also say that I do not bow to the TA god--you might say that I have a "healthy disrespect." If you are trading more on a short term basis, short term moving averges may be more useful (I suppose)--hell, why not use 5, 10, and 20 minuted MA for day trading? If it worked so well, we'd hear about more successful day traders, which brings me to my final point.
Day traders? Now I am not accusing you of this--I'm not accusing you of anything--but do any of you guys notice how often day traders on these boards claim to make "big bucks" day trading? I know that there are a couple--probably with big coffers to begin with!--but I am willing to bet that most are total failures or at least fail to beat the averages. Too bad we can't audit some of the claims made on these boards.
Final point? Okay, so that was not the final point, but this is. I think it is unfair when people, such as yourself, write messages that a stock other people own is going to the "low 50s" without backing it up. Such a hit to SUNW would be substantial--that's 7 points!--it would be like INTC going from 126 to 112!! Not that such suggestions weren't made when INTC was 115-118, but not today.
I am not sure about people's motives. Some are short. Some want to get in at a lower price long. And some people simply like to raise cain. I am not saying this M.O. fits you or that you have nothing but good wishes for SUNW. (Be sure to get that last detail in any response to me) I am saying that one of the unfortunate side-effects of this medium is that it equalizes the playing field so much so that you can't tell the difference between the insider posts, the MBA posts, the grandmother posts, and the thirteen year-old posts. If I am doing research, one of the most important factors is the crediblity of the source--which is more important than what the source says. I really wish we could somehow assess crediblity in some way other than having to read people's posts for a year before we learn to trust (or distrust) them.
There, that felt better. Again, this sermon was NOT directed at JPM (yet!), however, I do think you made a "guess" as to the stock price which does not have a lot of crediblity because it is supported by short-term averages (if that supports such a conclusion at all is certainly debateable as well). Moreover, even if such averages could point to such a conclusion, the drop is so substantial (even forgetting than SUNW dropped from 70 and 65 not too long ago!) that it would take more than "drift" to cause such a drop.
G'night! |
