Showing posts with label technical analysis. Show all posts
Showing posts with label technical analysis. Show all posts

Friday, October 29, 2010

Gold will correct - miners show outperformance.

I was cleaning out my 90 different charts I have annotated because I became unorganized in my research which ultimately creates sloppiness in my work. As I was deleting unwanted charts, I stumbled on a chart of the GLD and noticed some advice I posted on my blog more than a year ago. It was about a $1,300 dollar price target on Gold and around a 130 price target for the GLD. Although I believe we still have more upside to finally reach the 12th round of this Gold vs. The World grapple match, I will take my own advice and call this current move complete and will assume a consolidation for 6-9 months .

I first analyzed the chart below in the blog post Assessing The Gold Breakout - in the article I pointed out some guidelines of technical analysis for determining price targets on some of the different type of potential pattern breakouts that were occurring in Gold and the GLD.

This chart is from that blog on the gold breakout in August of 2009.



This is the same chart with time elapsed to present.



Basically, the price target I was predicting is here - 1300 - and the current Gold trade is finished for now. If we see more upside momentum, it will be short lived IMO. Although Gold is overdone on the long side, the new price levels in which Gold will consolidate are now higher than that of the last two years. This means volatility in the price itself which translates into smaller margins for the Large Cap miners. For the junior miners, small-cap and exploration companies, this means their growth potential and margin potential will continue to shift in the right direction - especially miners with rising production numbers.


The below chart is the Junior Miner Index - Market Vectors Junior Gold Mine - which is outperforming Gold and the Large Cap Miners in the GDX. This means finding the right mining stocks, specifically ones with growth and rising production will pay off medium-long term.




The Gold bull remains but a short-term correction will occur and I will assume it will be faster, more violent than any correction to date in the current Gold Bull. It will also provide great trading opportunities, specifically on the volatility side. It's also a good time to start implementing any option/equity strategies to hedge your risk according to your market bias.

Thursday, July 15, 2010

Advanced Battery ABAT

Lets keep it simple: Advanced battery comes to huge inflexion point!

If that uptrend line is broken by more than 20%, bail. If it stays in tact, not breaking the -%20 percent loss from here than hold on to it because we could begin to see a large move coming.





Advanced Battery Technologies, Inc., through its subsidiaries, engages in the design, manufacture, and marketing of rechargeable polymer lithium-ion (PLI) batteries in the United States, Europe, and Asia. The company’s rechargeable PLI batteries are used in consumer products, such as portable computers, personal digital assistants, and cellular telephones. It also develops and manufactures various types of electric vehicles, including electric bicycles, electric scooters, and electric sports utility vehicles.

Monday, May 17, 2010

STOCK OF THE WEEK - OTE

Greece, Greece, go away, come again another day, Wall Street wants to play, Greece Greece go away.


CHANNEL BREAK - OTE Hellenic Telecommunication

Tuesday, July 14, 2009

NEW UPTREND CHANNELS

First things first: find the trends and make sure you are on the right side of that trend. Below are 5 stocks with clear uptrends. I only include 5 because one should only stick to a handful of stocks and leave the rest for research. If you try and own or trade too many stocks, this can lead to overtrading which reduces profits due to trading costs, margin calls, inability to make clear and decisive decisions, etc.

So, sometimes it is more efficient to find 5-7 stocks and stick with them. Find your favorite stocks based on clear signals from your favorite technical indicators and with a clear uptrend/downtrend. Trade those stocks based on the trend lines - buy at bottom of trend, sell at top. Only introduce another stock if those favorable signals show signs of deterioration along with the break of the trendline.

During this time of trading your favorite stocks, there is always time for research, but the only time to enter into different stocks is if/when your technicals deteriorate and your trades start losing money. If it ain't broke, don't fix it.

I like to use MACD's, STOCHASTICS, MONEY FLOW and ADX indicators for the technical indicators and I always make sure I can identify a uptrend channel. Here are a few of my favorite uptrend stocks that have been working.

COEUR D ALENE CP NEW(NYSE: CDE)




MercadoLibre, Inc.(NasdaqGS: MELI)




FREEPORT MCMORAN B(NYSE: FCX)




MICRON TECHNOLOGY(NYSE: MU)






GOLDMAN SACHS GRP(NYSE: GS)




Notcie the slope of each trend - the lower the degree of the angle, the less profitable and less risk. The higher the degree of trend, the more profitable but also more risk.

NOTE: Whether the market has more to correct or not, these stocks should continue on their trend unless they break through that bottom trendline. Yes, they are associated with the market but new stock leaders will turn before the market bottoms. Notice that many of the stocks have recently tested that bottom trend at a time the market has been correcting.