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Strategies & Market Trends : Strictly Buy and Sell Set Ups -- Ignore unavailable to you. Want to Upgrade?

To: amoezzi who wrote (5741)	10/8/2005 8:21:06 PM
From: chowder	Respond to of 13449

>>> How does CEE look for a trade (long) next week? <<< CEE, like a lot of other stocks, was due for a bounce on Friday. On the accompanying chart, take a note of the CCI indicator. This is an indicator that like Stochastic, measures whether a stock is overbought or oversold. When the indicator is above +100, it's overbought, below -100 it's oversold. I use a 5 day setting to aide me in the time frame in which I trade, which is 2-5 days. The indicator went in a straight line from +100 to -100. The severity of the drop indicated we would get a relief rally and for other stocks with a similar indicator, at least a short covering rally. Friday's price action was very bullish. Price gapped up at the open, formed a wide range bar and finished near the high of the day. The chart is indicating you should have a follow through day on Monday. If not, a stop should be set below Friday's low or Thursday's low, depending on your tolerance for risk. stockcharts.com[h,a]daclyiay[d20050708,20051008][pb50!b20!f][vc60][iut!Ld5!Lah12,26,9]&pref=G Now let's focus on the candlestick pattern. When you take the most recent two days and blend those candles together, making a single candle, you get a bullish hammer pattern. You have a bullish looking 2 day pattern and most charting sites don't allow you to see a 2 day pattern. Why is looking at the 2 day pattern important? It's important because of the time frame you asked about. You wanted to know about next week. If we look at a weekly chart, you get a picture of indecision. The weekly chart of CEE has a candle with a large topping tail and a large bottoming tail. The pattern is similar to a large spinning top. A spinning top is a candle that signifies indecision. Neither the bulls nor bears have control of the intermediate term chart. The battle is still being fought in the shorter time frames. stockcharts.com[h,a]waclyiay[dd][pb50!b20!f][vc60][iut]&pref=G Now let's look at a 2 day chart. ttrader.com What do you see? A beautiful looking hammer that formed above a rising 40 day moving average. (Since this is a 2 day chart, the indicators are twice what are indicated. In other words, the 20 dma is really a 40 dma and a 50 dma is really a 100 dma.) So yes, it would be reasonable to expect price to rise this week, based on what the chart is saying as of today. Of course, as we get more information with Monday's or Tuesday's trading transactions, the analysis could change. That's why you pick a stop loss pivot in advance. You need to know where the current chart pattern breaks down and is no longer bullish. That way you keep losses to a minimum and if you are still interested in CEE, you wait for another buy set up. I don't know that CEE has the energy to set a new price high if price follows through this week. It would need to pick up strength. It does look like it will retrace part of the recent drop in price. dabum