>> why this stock keeps dropping lower and lower <<
Dropping it is, but since Aug 7 it is dropping differently. A good candlestick chart shows one aspect of this. The minor move from Aug 7 to Aug 17 was 7 red candles up and from Aug 17 to Aug 24 was 5 black candles down. No mixin just one trending color. Compare this to recent minor moves and these two true? minor moves are standing out.
Also, the are a lot of doji's hammers and tweezers in these two minor moves. These represent, within the day, a balance of forces.
Volume however, is still presenting a bearish pattern; relatively high on the bottoms and small on the minor trend tops ( see Aug 7, 17 and 24)
Still, from a distance, volume is exhibiting a remarkably consistent pattern. As I pointed out once before, on a daily chart over the past year, each "climax" bottom is arrested with less total volume. Since I made this point, it is now inclusive of the minor down thrust which included the 187+k block (balanced by small transactions) and, if I can call it, the current minor downtrend ending today Aug 24.
This I take to mean that there are less and less easy shares available in the float. They are being swept away into inventory which is another way of saying that the shares are being accumulated.
So, someone, so to say, does want these shares but they are taking advantage of the opportunity and refuse to pay a bid up price.
Turn the question around and while the "... the stock keeps moving up and up... it seems as if no one wants to sell this stock.." Again, one needs a context and to ask about the relative pattern in the current trading range considering the minor move and the movement from a more distant time perspective.
Each of these securities has their own "trading personality" and the closer that one observes them, over time, the more attuned one becomes to their pecularities. There are very strong arguments for concentrating ones energies on a few well selected issues.
While I think it is a learning experience which can be used again in other situations, realize that if flies contrary to most advice (diversify, cut your losses, don't fall in love with the stock, the opportunity cost of dead money, etc.) which you will encounter. But then, would you really expect otherwise?
Ed Perry |
