From the looks of it it looks as if Crocs (CROX) will be near support at 16.50 and might also form a hammer therefore I really like to be long on CROX tomorrow with a stop loss at 15.80.
Update:
(HAL): It looks as if Halliburton will continue to slide tomorrow as it looks as if they will be forming another inverted hammer. Furthermore, it is near the top of the bollinger bands and is also near resistance.
(CROX): It looks as if it will be forming a hammer at 17.50 today which is a bullish sign along with being at the bottom of the bollinger bands with support underneath at 16.50.
Long:
Crocs (CROX)
Stop Loss: 15.80
Profit take: 19.00 or days end
Short:
Halliburton (HAL)
Stop loss: 40.00
Profit take: 38.00 or days end
Monday, March 31, 2008
Monday Analysis:
Here are my picks for today (Monday). It will be light blogging until Wednesday since I just quit my job and will be moving home until then.
Because of this there won't be much analysis of my choices and frankly they might not be very good. But here goes for the sake of staying an "everyday stock picker"
Short:
Halliburton (HAL)
with a stop loss at: 39.70
Cover at: 38.00
Long:
Urban Outfitters (URBN)
Since there is a lot of resistance at 31.00 I would recommend to take the 2% profit and to sell at 31.00
Sell at: 31.00
with a stop loss at: 29.9
Because of this there won't be much analysis of my choices and frankly they might not be very good. But here goes for the sake of staying an "everyday stock picker"
Short:
Halliburton (HAL)
with a stop loss at: 39.70
Cover at: 38.00
Long:
Urban Outfitters (URBN)
Since there is a lot of resistance at 31.00 I would recommend to take the 2% profit and to sell at 31.00
Sell at: 31.00
with a stop loss at: 29.9
Saturday, March 29, 2008
Bear Stearns Explained
As I'm sure that most of you know Bear Stearns (BSC) recently had a tremendous amount of downward pressure from their high exposure to the mortgage loan market.
Now this is not a technical case as to why you should have invested in BSC when the offer came in at 2$ that weekend because all of the technicals were screwed... but there were many reasons as to why the stock price began to creep up on March 17th until the new offer was posted at 10$ a share on March 24th. Here is the reason:
At 4$ a share BSC's market cap (worth of a company) was 545m. Finally after snooping around for a while I found that the assets alone of the buildings of BSC was 605m (from AOL). Which is not even including any of the "Actual" cash that they may have because banks cash flow statements are very confusing since their investments are cash and can be leveraged which is why BSC says it has a book value of 80$ a share (which is obviously false).
So with just the assets of the company alone of 605m that has a price of $4.50 a share. So when it bottomed out on the 17th at 2.84$ this was an obvious buying opportunity for anyone that was smart enough to get in at that 1.20$ ish range of the bottom. Even if you got in at 4$ and then sold at the value of the PHYSICAL assets of the company at 4.50 that is still a 10%-ish swing in a day or 2. (Which is pretty much what you can get from a good mutual fund in a good year).
These are the types of values that you need to keep in mind and when something gets announced after hours like this do your homework, figure out what happened and if it is correct because even if that was the correct offer at 2$ that doesn't mean that someone else can't realize a fire-sale when they see it and outbid JP Morgan.
Now this is not a technical case as to why you should have invested in BSC when the offer came in at 2$ that weekend because all of the technicals were screwed... but there were many reasons as to why the stock price began to creep up on March 17th until the new offer was posted at 10$ a share on March 24th. Here is the reason:
At 4$ a share BSC's market cap (worth of a company) was 545m. Finally after snooping around for a while I found that the assets alone of the buildings of BSC was 605m (from AOL). Which is not even including any of the "Actual" cash that they may have because banks cash flow statements are very confusing since their investments are cash and can be leveraged which is why BSC says it has a book value of 80$ a share (which is obviously false).
So with just the assets of the company alone of 605m that has a price of $4.50 a share. So when it bottomed out on the 17th at 2.84$ this was an obvious buying opportunity for anyone that was smart enough to get in at that 1.20$ ish range of the bottom. Even if you got in at 4$ and then sold at the value of the PHYSICAL assets of the company at 4.50 that is still a 10%-ish swing in a day or 2. (Which is pretty much what you can get from a good mutual fund in a good year).
These are the types of values that you need to keep in mind and when something gets announced after hours like this do your homework, figure out what happened and if it is correct because even if that was the correct offer at 2$ that doesn't mean that someone else can't realize a fire-sale when they see it and outbid JP Morgan.
Next Week:
Possibilities:
Short:
HAL (39->36.50) MA 200 @36.50 MA 50 @ 36.00 inverted hammer @ 39 then doji
Long:
URBN (30.27 ->33.00) MA @ 29 hammer from 29->30
Short:
HAL (39->36.50) MA 200 @36.50 MA 50 @ 36.00 inverted hammer @ 39 then doji
Long:
URBN (30.27 ->33.00) MA @ 29 hammer from 29->30
Friday, March 28, 2008
Update after Week #1
The first week of my light stock analysis has come and gone and the only prediction that I made on this blog was that the Dow had reached a TOP on the 25th because of the DOJI that was formed. Let's see how I did.
As can be seen this graph the reasons for my thinking that the market was going lower was because there is resistance at roughly 12,800 and support at around 11,750. On the 25th as can be seen from the blue circle a doji (a cross)/ hammer (it is kind of a combination of the two candlesticks). When a doji or a hammer is formed during an uptrend it generally signals the top. Also as can be seen from the RSI on the top of the chart it began declining from about 60 (which is almost over-bought). Also the MACD began declining and the Fast stochastics cross which are all negative signs. All in all about 2% of a decline since the 25th.
I had also mentioned to my friend that AMD looked like a good short on Wednesday but didn't have enough time to really look into it. So lets look at what happened here is the chart:
As can be seen from this graph there is support for AMD at around 6.00 but a descending triangle had been forming since the end of February. Also all of the other indicators were all showing negative divergencies. It is because of this that I felt that on the 25th that AMD was in for another fall and they went from around 6.25 to 6.00 in the past several days which is about 4% of a loss.
I'll get out next week's analysis over the weekend.
As can be seen this graph the reasons for my thinking that the market was going lower was because there is resistance at roughly 12,800 and support at around 11,750. On the 25th as can be seen from the blue circle a doji (a cross)/ hammer (it is kind of a combination of the two candlesticks). When a doji or a hammer is formed during an uptrend it generally signals the top. Also as can be seen from the RSI on the top of the chart it began declining from about 60 (which is almost over-bought). Also the MACD began declining and the Fast stochastics cross which are all negative signs. All in all about 2% of a decline since the 25th.I had also mentioned to my friend that AMD looked like a good short on Wednesday but didn't have enough time to really look into it. So lets look at what happened here is the chart:
As can be seen from this graph there is support for AMD at around 6.00 but a descending triangle had been forming since the end of February. Also all of the other indicators were all showing negative divergencies. It is because of this that I felt that on the 25th that AMD was in for another fall and they went from around 6.25 to 6.00 in the past several days which is about 4% of a loss. I'll get out next week's analysis over the weekend.
Tuesday, March 25, 2008
Innaugural Post:
The reason that I decided to start this blog is because of the lack of information out in bookstores and available about technical trading and the more advanced techniques. Every book talks about triangles, head and shoulders patterns, support and resistance but none of them get into the indicators that real stock traders use.
This blog will help the average investor understand through everyday examples the importance of both fundamental and technical analysis because these are the two types of investors and they both help to influence the market.
Mostly though this blog will be talking about short-term trading commonly known as day-trading although the applications can be widespread to help "buy-and-hold" investors get in and get out before big events.
I do not know everything about stocks so please if you have something to add to the conversation please feel free to contact me and let me know how you feel. Also most of the analysis that I will be doing will be more on the value side of things because I feel that there is less downside risk in these types of stocks than momentum stocks.
With all of this being said please enjoy the site and happy trading!
This blog will help the average investor understand through everyday examples the importance of both fundamental and technical analysis because these are the two types of investors and they both help to influence the market.
Mostly though this blog will be talking about short-term trading commonly known as day-trading although the applications can be widespread to help "buy-and-hold" investors get in and get out before big events.
I do not know everything about stocks so please if you have something to add to the conversation please feel free to contact me and let me know how you feel. Also most of the analysis that I will be doing will be more on the value side of things because I feel that there is less downside risk in these types of stocks than momentum stocks.
With all of this being said please enjoy the site and happy trading!
Brief post on the state of the stockmarket in general
From a basic chart of the last 3 years we can see that there is support for the Dow Jones at 11,750. Currently using a daily chart we can see that over the past week the Dow has rebounded from this support at 11,750 . Over the past week the market has made a substantial run up with yesterday forming a doji (a neutral indicator) and the day before that an inverted hammer (which in an uptrend generally spots a top).
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