Spike's Scientific Stock Analysis

[spikefader]

Spike how do you feel about holding a stock thru earnings report?

Well, I have mixed feelings, but generally don't hold unless I'm in very good profit and there is nothing technical telling me to exit. I'll be watching like a hawk during the announcement too in the event I have to change plans suddenly. My general rule is if it pops quickly to resistance, sell the position. I've made a lot of money shorting this way; wait for the pop to sell, and hold it as the stock tumbles after hours and the next day. It's something a lot of smart traders do; short the pop. But for strong earnings reports and results that beat by a long margin shorts get creamed so that's why you need to have a stop. For yours, I'd hold it until she pops to resistance, sell it, and if you love the stock, bid nice and low and look for a discount after the pop. It can be rewarding if you're nimble.

After hours and premarket action can be volatile and can bite you. It's a risk, more so than regular trading. A lot depends on volume of the stock, and the nature of the earnings news. A high volume stock, you've got a better chance of being ABLE to exit without as much slippage than a low volume stock. But in the end, the more unexpected the news, the more it might pop/the more slippage you'll feel on the downside.

[RL]

Thanks Spike I really appreciate your answer.

[spikefader]

Good morning Spike..

Could you tell me thoughts on GNTA ??
I figure you will say it is filling the gap.... Would appreciate TA thoughts on buy signal and target.. I already own and am looking to add .

Hey Greb.

Yep, you read my mind on the gap fill. If you look on a 3-year weekly, you'll see that the nice recent spike up was to channel short and it's worked nicely. I would certainly think it will look for the gap fill. That's an excellent place to add. Good luck!

[spikefader]

MESA is on my by alert. I think this one is ready to rock!!

And she pops



previous chart:

[tokyojoeskid]

sndk

Hey Spike,

what do you think Sndk upside potential is?
thanks

tjK

[spikefader]

Hey Spike,

what do you think Sndk upside potential is?
thanks

tjK

congrats tjk! I'd be looking to lock in profits up here; weekly upper channel tag now. If you really wanted to push your luck, you could hold it for another 2 weekly candles, but I'd be trailing a stop pretty tight now.

[tokyojoeskid]

sndk

Its really hard to figure this one out. It seems like it has been tagging the upper channel every day for about five days straight, then the small downward trend now the upward trend. It is just tough because when the "tasr's" made their runs they were setting new highs almost everyday, and I am sure tagging their upperchannels. The million dollar question was, When do I sell? So when do you take some off the table with a stock that consistenly is hitting 52wk highs?

I have the Jan 06 (50) calls, is this something where I should be looking to take out my cost and just let the profit ride? I have a lot of time on these calls and they are just in the money as of today, which means I should be making dollar for dollar with every increase of a point to the stock. That means much bigger percentage gains for me. I really don't know where to go because I have no strategy in place, but I do like this stock long based on fundamentals and the many products they have released, and the potential of some of their products.

I'm in since 2.55 let it ride? I'll prolly give it another day or two before I make up my mind, seeing as how it was up on incredible volume and closed near the high of the day. Lets hope this wasn't a blowoff top.

TJk

[IIC]

Spike...???...And I am serious...In one or two sentences...Could you explain the difference between Slow, Fast and Full Stochs?

I usually watch Slow...but for the life of me...I could not tell you why...Thanks for any insight...Best, Doug(IIC)

[spikefader]

...It seems like it has been tagging the upper channel every day for about five days straight.......tough because when the "tasr's" ..I am sure tagging their upperchannels. The million dollar question was, When do I sell? So when do you take some off the table with a stock that consistenly is hitting 52wk highs?
I have the Jan 06 (50) calls, is this something where I should be looking to take out my cost and just let the profit ride? .... I really don't know where to go because I have no strategy in place, but I do like this stock long based on fundamentals and the many products they have released, and the potential of some of their products.
I'm in since 2.55 let it ride? I'll prolly give it another day or two before I make up my mind, seeing as how it was up on incredible volume and closed near the high of the day. Lets hope this wasn't a blowoff top.
TJk

I'm talking about the WEEKLY channel in this chart:


That is a fresh one. It's more significant than a daily upper tag. But you are correct, insane bullish stocks just boom through them, which is why I call them booms. But to date, this one hasn't boomed through the channel. It might; it might not. But either way, it's at very significant resistance, and smart traders sell significant resistance. I'd much rather lose potential than to lose profits. If it booms, THEN it's proven it to us, and I'd look to perhaps open another position if you are FA bullish on it. It's not going to keep going forever though. And don't expect that you will sell it at the high. One might do that once in a thousand exits. All you can do is set a resistance target that is reasonable. You will either choose well and have caught a big chunk of it, exiting during strength (which is what one SHOULD try to do) OR you will optimistically HOLD it, watch it drop, tighten your stop to protect profits, and ultimately stop out during weakness. I can tell you this: It's BETTER to take profits because YOU decide, and not when the market decides. Sure, you might miss some of the run, but that's really OK. What is important is whether or not your target plan is reasonable and full of sneaky trader wisdom. You'll get the most out of those call options if you sell them at the ask during a climatic blow-off intraday bullish run than you will during declining prices. So whatever you do, sell them at your terms, patiently holding the ask at high intraday resistance prices, where the bullishness is making you feel gleeful. 9 times out of 10 when you're feeling ecstatic, it's time to sell. Just when you feel like you're a genius and it's parabolic, it's time to sell. Don't let greed blind your vision. Ask yourself what is the right thing to do NOW, and not worry about tomorrow. Tomorrow will work itself out if you do the right thing today

Personally, I think when the correction comes, it'll go back to 45.00 gap fill, and when it happens it will be fast - maybe take four or five days at the most. If you do sell on the way up, pick intraday R2 will ya. Or wait for SHS neckline break.

[ForeverInvesting]

Spike...???...And I am serious...In one or two sentences...Could you explain the difference between Slow, Fast and Full Stochs?

I usually watch Slow...but for the life of me...I could not tell you why...Thanks for any insight...Best, Doug(IIC)

Hi IIC,

I am sure Spike can give you a concise explanation of the difference between Slow, Fast and Full Stochastic; however, I found the following the article at the ChartSchool section of StockCharts.com that addresses the difference between Slow, Fast and Full Stochastic.

http://stockcharts.com/education/IndicatorAnalysis/indic_stochasticOscillator.html

I hope this helps.

Mike

[spikefader]

Spike...???...And I am serious...In one or two sentences...Could you explain the difference between Slow, Fast and Full Stochs?

I usually watch Slow...but for the life of me...I could not tell you why...Thanks for any insight...Best, Doug(IIC)

As I read through that link foreverinvesting provided (thanks) my 2 sentence summary of it all is this:

The difference between them all is simply the way they are 'smoothed' by applying a moving average calculation Stochs is just a representation of closing price values relative to a the high/low in a range of days, and the values are smoothed to produce the second line that is used to 'time' crossovers.

And contemplating all that, it makes me wonder just what use it is. I mean why should closing value relative to high/low values be important or significant? I can think of more important or significant things that would help trading..............like closing value relative to support and resistance.

Now there's a thought: I might just design my own stinkin' indicator based on closing price relative to support in a chart, taking into consideration price s/r, channel s/r, pattern s/r. Maybe I could devise a point system that one could actually trade off. Points added for bullish things, points deducted for bearish things, some things being more significant than others, so I could scale the point system, and it would be very reactive and fluid...... OK, to the drawing board.... patent pending

[IIC]

Hi IIC,

I am sure Spike can give you a concise explanation of the difference between Slow, Fast and Full Stochastic; however, I found the following the article at the ChartSchool section of StockCharts.com that addresses the difference between Slow, Fast and Full Stochastic.

http://stockcharts.com/education/IndicatorAnalysis/indic_stochasticOscillator.html

I hope this helps.

Mike

Thanks For...But that's the explanation that confused me in the first place...Doug(IIC)

[IIC]

Spike et al...The reason I asked is that DGO now offers Stochs...but I don't know yet whether they are using slo, fast, full...they never seem to match Stockcharts. It is not my fave tech indicator by any means...But I was just wondering...thx

[Runner]

IIC, being a momo guy I thought you would find Stochastics useful. I view it as a momo indicator and IMHO it is pretty darn accurate. This example is a series of charts using the COMPQ as an example.

First chart shows 20 band pop. One could have taken a swing long off this signal here.


Next area of concern is the 50 band. In order to stay on the long side the STO needs to take out the 50 band and stick.


Now we broke the 80 band and moving into short term over bought territory. One now needs to watch how STO acts. This chart shows we might retest to 80 band. Market failed to make a higher high.


This chart tells one to exit the market or go short. The 80 band did not hold and this tells you the buying energy has expired. Notice how nicely this indicator works....


Current chart gave signal to take market long but the 50 band could not hold and thus gave warning signal for longs. Not sure about you but this indicator does a very good job of showing the momo.

[Runner]

This chart told one that the market is funky. Notice the 3 lower highs in the trend. This was the warning that intermediate trend is weak.

Sorry that you and Spike view this indicator as being useless but I guess to each his own, but My view is that STO is the engine under the hood of the markets. It clearly is a momentum indicator that IMO shows pretty darn good swing signals.

Last point on STO it is also good in any time frame you use be it 5min, 60, or what ever.