I want to practice my charting skills and technical analysis. Name a stock, any stock. One at a time please. I'll chart it out and give you the skinny. I dont warranty my work so you will have to take it "as is". Then we'll see what happens and see if the crystal ball I am using works. I will now put on the wizards hat with all the stars on it and throw up the statues of Livermore, Elliott, Bollinger, Fibonacci. Then we'll burn Jim Cramer in effigy. So give me a stock, any stock...
QID Failed Triple Bottom Reversal 1. Prior trend- Long existing downtrend that lasted for several months 2. Three equal lows- Late Nov, Early Jan, Late Feb 3. Volume- Expansion of volume on the third advance. 4. Resistance break- Did not break resistance on the third advance. 5. Price-Target- About 8.6 Bollinger bands- The Bollinger Bands from late Nov to Late February had tightened significantly indicating low volatility. When the bands tighten like this, it tells me that the chart is setting itself up for a big move. Bollinger Bands had widened on the third advance indicating higher volatility. Point and figure chart=72 Conclusion- On the third advance, the price failed to break through resistance. There are three possible outcomes from here- 1. There will be another pass towards the 57 level. Resistance breaks and the price target would be 65.6. 2. The equity will remain stuck in a range between 49 and 57. 3. There will be a pass breaking the support in which the price target would become 40.4. There might be one more pass towards resistance, but I feel it will fail. If the equity goes into a range making higher lows, then it will be basing and turning into an ascending triangle which will last about 1-3 months. A telling sign will be the reduction of volume, tightening of the bollinger bands, and reduced volatility. At this point, the most likely outcome is for a basing to occur over the next 1-3 months forming an ascending triangle. Volume and volatility will sink with each passing day. Then there will come one day when there will be a significant breakout with the price target being around 65. There will be significant volume on this breakout.
MTW- Failed Cup/Handle Continuation Pattern 1. Prior trend- August 4th, 2003 started the uptrend for MTW with the closing price on that day being 8.47. The price went from 8.47 to a high of 54.66 on May 5th, 2006. The price then fell during what appears to be a correction after that with the bottom price being 36.83 reached on July 21st. The price then rallied to a high of 61.67 on December 8th. After that another pullback occurred with a low coming on Feb 2nd at 55. The price then rallied to 63.50 until February 27th where it then corrected down to 56.92 and then went back to 63.88 where we see it today. The chart shows many recent gaps in trading. 2. Cup- The cup was formed over the summer of 2006. The depth of the cup appears to be 28.69. The cup loosely complies with Fibonacci as it came very close to a 50% retracement. The 50% mark being at 31.565. 3. Handle- The price retraced exactly in accordance with Fibonacci principle. Ideally, you want to see this retrace right to 61.8 fib line which in this case is 51.66 (it retraced to 51.31). 4. Failed Breakout- It appeared that the price would breakout from 51.31 with a target price of $80. At $65, a volatility event occured bringing the price down to $54. This may not have harmed the cup/handle formation however. The retracement to $54 complied with Fibonacci principles, that is, if all the trading from late Nov to late February was erased. The chart reset itself. So if the high of 65.96 was made in late November then this would have been a perfect retracement. Therefore, the handle was reborn during the volatility event. 5. Concerns- The gaps always give me a concern because of potential retracements that tend to occur. There is also a triple top forming. 6. Potential ascending triangle- The price might get stuck in a range. It appears that it made a low of 51.31 and then the next low is 54. The tops might be equal from here if it gets caught in a range. This is an ascending triangle pattern where it prepares itself for a breakout over a 1-3 month period on reduced volume and volatility. Conclusion- 1. If the price gets over 67 with volume, then go long. Your price target will be north of 80. 2. If the price does not pierce through 67, then go short for a quick range trade. Cover at around 61-62 and then watch to see where it goes from there. 3. If the price goes below the middle Bollinger Band, then watch for a pivot point. If the pivot point is above 54, then we could be moving into a long ascending triangle. Go long at the pivot point and watch for it to revisit the 65 level. Sell at 64 though and watch to see what happens next. If it bounces off of 65, go short. If it goes through 67, go long. 4. If the price goes below 50, then the price target will become 39. Go short under 50. Cover low 40s. 5. If the ascending triangle does form with a higher low, then most likely it will complete in another month with a breakout. Target will be north of 80. Point and figure chart=92