Hi Gary,
I spent some time on the chart of Netscape before taking any position. I'm in at 17 7/8 and up. I have taken this move all the way to a target of 140, so far; but it doesn't do any good to post these long targets b/c people lose patience when there are pullbacks, and then I could be wrong! <g> so, no sense going too far ahead.
The 58R is a point on the chart where volume and formation meet to form a barrier to further price appreciation. We can target it and expect some problems there as well. In NSCP's case, at this point in the game, the volume is typically representative of a number of investors who may still be in the stock; some may continue to stay long while others are itching to get out (having held for so long and just glad to break even).........they'll sell into the strength of the rise, stalling the stock. This won't kill a healthy stock that has a lot going for it and will attract new investors. It just slows the advance for a bit. We are working on some 45/50 resistance right now, in fact, imho.
Formation is just a pattern on the chart.......others who know how to read charts will be watching these same patterns and trading against them........this, in and of itself, reinforces support and resistances; but, these formations are caused by trading in the first place..........so, you've just got to sort of reverse engineer them! <gg>
Well, there are also other things to consider when targeting a resistance level, but maybe you should check out some books, and then there are some threads on S.I. about TA.......not sure how much you really want to know......anyway, hope this helps.
Good Luck,
E! |
