Some TA for today....
Let me start by saying that the price is up from just a few weeks ago...way up, as many have pointed out. This one fact looked at in and by itself could suggest to buy long...the trend is your friend...right? Not always. IMO (and I stress opinion here) we are currently in an overbought condition. Given that ZRAN has not taken out new highs, my old friends the chart oscillators can be used to point out possible trend reversals. We have not had any divergences that would suggest to buy on the long side. ZRAN has had several short-term reversals on the up side in the past since it's decline from the 18s back in March, and each time ZRAN has made lower lows after it peaked in a matter of 1 to 2 weeks. I see no reason why this latest news-induced pop would be different. Judging from todays action it would appear I got my reversal on the downside at about the right point, and barring any fundamental changes (news) the trend should continue. However many a short has been burned using these basic techniques (I could be next!) and must keep on their toes and use stops. Anyway all I need in order to hold my short is several key bearish chart indicators and patterns to maintain my hold. I found many:
First off, one of the less popular indicators of the masses (but most important of the technicians who trade stock) is Volume. The 21-Day-Volume-EMA was trading at about 110K or so BEFORE ZRAN's last run. On the first day of it's public news release (Monday), Volume shot up to just under 1MM shares traded. On Tuesday interest declined after the initial wave of morning buyers got in and shorts exited and volume closed at right about 800K shares. Momentum had been lost. The shorts pounced all over it at this time. Today volume declined by almost 70% and price slipped some as well. Very few upticks presented traders for new short positions today. The MMs made sure of that (they want the shares? could be.). Price follows volume, and expect 12 to be taken out shortly. Bearish.
ZRAN came real close to the Bollinger Bands upper envelope resistance (13 1/2) on Tuesday, only to fall quickly back to neutral ground within the envelope. All momentum faded here. Today ZRAN closed lower still. BB support is pegged at 11 7/16. There is only about 1MM shares of overhead that will keep ZRAN above 11 7/16, so support is not very strong in the event of a continued decline. Bearish.
The MACD Histogram is at it's highest point in over a year, and still climbing as of today. MACD suggest continued momentum is still holding ZRAN up, and is sufficient enough to continue the up trend. Very Bullish.
ZRAN is still trading above it's 21day and 50day moving averages....alot of chartists play by these indicators, and may have already sold....but will jump back in the moment one of these is touched. No read....just thought I'd mention it.
RSI went down today...had been as high as 57. Kinda bearish (no 30/70 crossover.)
The Bostian's Accumulation/Distribution Oscillator had a price divergence on Monday....this is very bullish (it indicates a possible trend reversal)...but the reversal was never verified due to today's poor trading activity. Monday-Bullish. Today-Bearish.
There are some other charts that I did not mention.....just covered the ones that stuck out.
Regards.... |
