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Strategies & Market Trends : Playing the QQQQ with Terry and friends. -- Ignore unavailable to you. Want to Upgrade?

To: sandintoes who wrote (973)	6/22/2005 10:31:38 AM
From: Walkingshadow	Read Replies (1) \| Respond to of 4814

I think KKD will move down to the lower BB rail, which is currently at a level of recent chart support. I have been bearish on KKD for a long time and have shorted it 3 or 4 times I guess. But I am much less bearish now, and in fact cautiously bullish. That's because after a long decline, KKD has started showing definite signs that it is making a bottom. Note the volume surge in February/March: 139.142.147.218 stockcharts.com[w,a]daclyyay[dd][pb50!b200][vc60][iLg!Lk14]&pref=G However, on the daily chart you can see that a substantial portion of this volume was actually selling into strength in March. That pretty much offset the previous month's buying into weakness: 139.142.147.218 You can also see on this chart that the lows in the MACD histograms have been getting less and less negative, indicating that downward momentum is subsiding. Over the past few months, KKD has formed a series of higher lows, and now there is an upsloping trendline where KKD has found support. It is currently approaching a test of support at that trendline: stockcharts.com[w,a]daclyyay[dd][pb50!b200][vc60][iLg!Lk14]&pref=G That trendline roughly coincides with the now horizontal 50 sma (it has been downsloping for a very long time) at $7.12 and the lower BB rail, also at $7.12. The BBs are contracting sharply now. There is a chance KKD will again push down on that lower rail, but I think it is more likely it will find support there and instead rally up to the upper BB rail and push up on that. stockcharts.com[w,a]daclyyay[dc][pb50!d20,2][vc60][iLg!Lyb20,2.0]&pref=G I would not trade KKD here, but I would watch and see what happens at the lower BB rail. In the past, when the stochastics have gotten oversold (i.e., below 20), they have stayed there for a month or two as KKD generally continued strongly down. This time, I think there is an excellent chance KKD will successsfully test support there, and if so, will be a good long position. So, look to go long at about $7.12, but that is a potential entry point only. I would require clear evidence of reversal from the intraday chart, technical evidence of reversal on the daily chart (currently there is none), and would also like to see accelerating volume over the next several sessions as KKD trades down to test support. T