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Strategies & Market Trends : Ask Vendit Off-Topic Questions -- Ignore unavailable to you. Want to Upgrade?

To: MJ who wrote (7392)	4/6/2005 12:50:23 AM
From: Walkingshadow	Read Replies (1) \| Respond to of 8752

<< I even understand what Terry is doing. >> One can only hope that Terry understands what Terry is doing! <ggg> T

To: MJ who wrote (7392)	4/6/2005 1:24:35 AM
From: Walkingshadow	Respond to of 8752

Well, if Denholm is predicting upside for RNWK, I would not disagree in general, depending on what time frame he is talking about. I just think we will see correction back to support before that happens. If he thinks we will see more upside in the very short term (a few days), I would like to hear his arguments as to why. The chart now shows that RNWK closed at the top of the BBs in an area of chart resistance. There are no clear, confirmed sell signals yet. Only Williams is beginning to hook downwards, but that alone does not constitute a sell signal: 139.142.147.218 stockcharts.com[w,a]daclyyay[dc][pd20,2!b200][vc60][iLa12,26,9]&pref=G As mentioned before, there is a clear bias towards an upside breakout, but I do not yet see evidence that this will occur on this attempt. It is too early to say for sure based on the daily chart because technical confirmation has not yet occurred (i.e., stochastic crossover), but still I anticipate RNWK will correct back to support at around $5.60 before it again tries for a break to the upside to test $7. I think it very likely that a test of this level will occur in the coming weeks. That said, the stochastics give very little hint yet of weakening on the daily chart, but they are getting into overbought territory close to where reversal has occurred in the past. The magnitude of the MACD histograms implies there is not a lot of momentum either way in RNWK. If you use the quicker stochastic setting (5-3-3), still there are no definite sell signals in RNWK yet, but you can begin to see evidence of stochastic weakening that tends to corroborate the early Williams signal: 139.142.147.218 On the intraday chart, RNWK appears to have failed at the 40 ema: 139.142.147.22 However, late in the session it made a run at the 40 ema as you can see. You can also see that the technical situation improved (Williams sharply up, OBV up, stochastic decline stopped and reversal of stochastic started), and now show early intraday buy signals, although the stochastic has not quite crossed over yet. Still, I think it is more significant that there was a clear failure at the 40 ema in an area of resistance defined by the upper BB rail. Therefore, I think the most likely scenario is that RNWK initially rallies a bit as overnight retail buy orders are filled, then early in the session the 40 ema will again fall and confirmation of that will occur. Then, continued downside to successfully test support at around the $5.60 level. As always, a wild card is unanticipated news (good or bad), which the market will have to factor in as quickly as possible. Perhaps Denholm is anticipating something on that front?? T