Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Pastimes : ASK Vendit Off Topic Questions -- Ignore unavailable to you. Want to Upgrade?

To: brk who wrote (18646)	1/31/2001 10:24:07 PM
From: Walkingshadow	Respond to of 19374

brk, So far, so good. Short term things look bearish, in that the stock has gotten ahead of its short-term moving averages, and should soon correct back some: askresearch.com However, long term things are quite bullish: askresearch.com Note the V-bottom and a near-Doji on huge volume, followed by a test of that bottom which was successful. Now RSAS has successfully rallied above all the moving averages, which are crossing over bullishly and reordering themselves to align with the uptrend. RSAS is one fascinating chart, and I think worth looking at in some detail. The stochastic is very interesting. Try flipping the settings on the six-month chart from the 15-5-5 to the 5-3-3, and then the 13-7-7 stochastic. For most stocks, the 15-5-5 and/or the 5-3-3 stochastic is the best. But with RSAS I think you will see that the 13-7-7 stochastic here is a superior indicator, better than either the 5-3-3 or the 15-5-5. Williams is not helpful, IMO. PROC has to be adjusted also to 30-15 rather than the usual 16-8. This is an interesting example of how you must find the technicals which fit the stock, rather than making the stock fit the technicals. Some stocks perform in different cycles than others, and so for some stocks a particular indicator may be very accurate, yet be very misleading when applied to other stocks. The point here is that one should be flexible to some extent in applying technical indicators, and be aware that there are differences in stocks which tend to be repetitive, and be sensitive to those differences. They can be subtle, but significant just the same...... One of the idiosyncratic things about RSAS is the extended uninterrupted runs it tends to go on. Look, for example, at the downtrend which began in mid-August, and proceeded virtually without interruption until the beginning of October. That is unusual. That run ended with a classic reversal candle, a narrow range day (or near-Doji) on climactic volume. What immediately followed was a gap up and an extended, almost uninterrupted rally lasting about three weeks. Another idiosyncratic thing I notice about RSAS is that it repetitively forms double top formations---one in August, one in October/November, and one in December/January. Now it is testing old resistance at the same level where a double top was formed in August.......might it be forming another one now?? These double tops were previously followed by very sharp selloffs, so the expectation would be the same here as well. These selloffs occurred despite the fact that the stock was trading above all the long-term moving averages, which for the vast majority of stock offer very solid support/resistance, particularly the 200 day. However, RSAS marches to the beat of a different drummer, it would seem, and the 200 day simply doesn't have the significance that it usually does. The suddenness and severity of the selloffs smells strongly of big-time manipulation to me. Some schoolyard bully is muscling that thing down, and up also for that matter, and taking a lot of people's lunch money along the way. One final thing I notice is that the long-term moving averages on the 12 month chart above have gradually converged. Whether this translates into decreasing volatility and a basing period remains to be seen. My take is that RSAS is being primed for another big selloff, but not for a week or so. I would be very suspicious that another double top is forming, and at the first sign of failure on the other side, a short entry would at that point be very reasonable. Of course, I wish you the best of luck with this trade. However, I have to say that a short entry now in a stock which appears to be heavily manipulated, and prone to extended runs, and is in a technical uptrend (albeit of limited significance), and has rallied recently so impressively, I would consider premature at best. I don't like to anticipate entries, particularly so with short positions, partly because the downside is constrained. As always, JMVHO...... Walkingshadow

To: brk who wrote (18646)	1/31/2001 10:58:33 PM
From: Walkingshadow	Read Replies (2) \| Respond to of 19374

brk, ESPD has been in an extended uptrend which has rallied impressively through all the moving averages. The situation is not unlike that of RSAS. There are early technical sell signals, and the stock is overdue for a breather here. However, with ESPD, it looks to me like you are a bit early on a short entry also. askresearch.com The major problem I have with shorting ESPD is that it successfully tested the 200 day ema. However, this has not been confirmed yet. Confirmation would consist of the stock retracing back to the 200 day, then bouncing off it to continue the uptrend. As soon as the previous peak is taken out, then the uptrend has been confirmed IMHO. An alternative scenario is also possible, and for your sake I hope this is how it works out. Sometimes with a breakout you get a head fake rally, then the stock fails again. So, in this case, if the stock started to correct, then failed at the 200 day ema on strong volume with a bearish candle and sell signals technically, that would be most consistent with a continued failure, and at that point would be shortable IMHO. Note that there is a downward trendline established from September to early January along the peaks. ESPD has broken out above this trendline of course, but I mention this because this trendline should also offer decent support if ESPD fails here, and this is a point I would look to cover a short position. The stock would be trading at roughly 15 or 16 there, and that would also translate into approximately 50% profit. This is about as much as you can ever hope for realistically from a short position, so if it could trade down into this region, I would be more than happy to cover there. All JMVHO, as always..... Walkingshadow