All: Intel is close to breaking down out of pattern after
today's trading. The lower trendline is coming up around 132
which is not too far from Intel's previous low of 130 7/8
that it made the previous time down. It's in a beautiful
symmetrical triangle chart pattern with declining volume
ever since it made its all time high at 141 1/2. This is
typical of these kinds of technical patterns and there is no
way to know for sure which way Intel will break until it
either goes above my previous resistance areas given or
below the numbers given above.
All indexes were down a little today - but what was more
significant was the fact that they couldn't make any real
headway in spite of the Dow having previously made an all
time closing high and higher intraday highs during this
period. So, we are about 1 day from put up or shut up time
with Intel for sure and possibly the indexes not too far
behind. I would not want things to break down too badly in
here tomorrow as it might stampede people out of the stocks
that they would otherwise hold. Any bad closing numbers
tomorrow and Thursday is really critical. It's usually some
problem anyway during bull years as some people who have
profits wait for the first trading day of the new year to
take those profits. How bad things get on that day depends
on how much new money the funds put to work at the same
time. Any holding back by them and it's D Day. Usually
thereafter, the markets regroup and rally - but not always
every year.
Thus, in conclusion - I say tomorrow and Thursday are both
critical days not only for Intel but the general markets as
well.
Added: jmac - the triangle that I'm talking about starts with the first top at 141 1/2 and subsequent tops at around 138 3/4 or so and around 138 1/4. The two bottoms are in between those three tops, the last bottom being at 130 7/8; and now we are heading down again to a point where things are becoming critical as I outlined above.
Somebody asked about the January 120, 125, and 130 call options. As long as they are profitable to you, any option is okay.
However, remember that the January expiration date is fast approaching and things can change mighty fast. Thus, you should be very careful not to let any profits get away from you, but on the other hand to not throw in the towel to early either. It's your call as to which is best for you. The thing that options buyers have to remember is that they are depreciating all the time as they head toward expiration date - and that's true whether the stock is standing still or going up. The MMs continuously take out the premium on them day to day. Hence, somebody on here asked about the 135s cost while the stock was doing something else. All for this evening.
BTW, my Intel gap technique worked again for the umpteenth time today as it gapped up to 136 1/8 on the opening only to fall back later below Friday's closing price by 1/4 point - which was then a sell. However, twice Intel pulled back up by at least one point as I've pointed out on here before that it is inclined to do. Not always, but many times. Good trading. Jack |
