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This post is for the couple of people who asked for my perspective from a technical analysis standpoint. I have no pm and do not wish to argue.
The kmag chart is dead. There is not enough volume for predictability other than what I told my friends over a year ago at half a penny that with low volume 000's were an inevitability. There will be no significant predictability until volume increases.
Volume will not increase until interest in the company is generated, and only verifiable facts from the company or official agencies backed by official documents will generate interest beyond insiders and cliques. So all discussion pro or con is hearsay, innuendo and opinion.
My only marginal contribution to the discussion would be in relationship to technical analysis. I stopped posting here amid a harangue that technical analysis doesn't apply to grey market stocks. That is false. Technical analysis is simply a graphic representation of price movement and trading volume where trends can be drawn and targets suggested. Professional traders use computer algorithms to calculate buy and sell signals based on technical analysis. When many such traders follow the same stock a self-fulfilling prophecy can be created as they all trade on the same signals. In the grey market few of these high frequency traders participate therefore the self-fulfilling prophecy element of technical analysis does not apply accurately. But technical analysis does work and has helped me determine buy and sell points on kmag with a sufficient degree of predictability.
The most reliable buy signal would be a breakout and retest of .014 on daily volume above 1mil shares. A sell signal was generated when that level failed and volume ramped down. Currently there can be no signals until there is significant daily volume. All discussion of fundamentals of kmag are pure conjecture without verifiable facts to back statements. Technical analysis works in grey market stocks, but in the case of kmag the technique will not be useful until the volume component becomes measurable.
Excellent post!
Great analogy Lownman
I'm in lowman. The latest social media messages, despite mistakes and apologies, make it clear what course KMAG is on.
wow!!! That secretariat video is inspiring! Could we possibly have a bet on such a phenomenon?
Jaime, my buddy, just to clarify, a week ago I did publicly post the thoughts I had shared with you earlier in private. In fact as you see on the charts in the following link, the price levels mentioned have already been reached including a close in the .000's. The volume of these declines is suspiciously low and the frequency is too often to be explained by "fat fingers" or random fluctuation. I couldn't say who has been "walking" the price down, but a certainty is that when transparency of KMAG's operations is made public the rise will not be a walk.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=101122120
Two charts:
On April 2 I began sending the first chart to friends warning that if shareholder confidence wanes due to continued absence pertinent information such as revenues, we could see the following price support zones challenged.
.004 - .005 blue
.001 - .0028 green
.0002 - .00057 red
The second chart shows that, subsequently, those levels were met.
The chart kept myself and friends from buying in the .008 consolidation area as it bumped against a forming declining tops line (magenta) which is presently experiencing a breakout. We did get some .005's and .004's. The decline seems to not be due to waning shareholder confidence as evidenced by low volume. Curiously but not surprising, the sharp intra day spikes downward were on vaporous volume from 10 to 100 thousand shares. Who would sell at 50% below the last price repeatedly for such a little amount of money, and for what reason? Certainly not profit taking.
Nonetheless, the action made a low volume spike on a weekly basis which nearly always indicates an impending trend reversal or a nearing of the ultimate bottom. Undoubtedly, there are those who are hoping for a high volume panic sell off. We shall see if they are accommodated, now that the company is releasing incremental information to shareholders. Should substantial information such as revenues be released, there would likely be a mass pick up in volume and upside direction.
Thanks friends. Of course the chart has been accurate so far during the greys and before. Remember there were times when I loathed to argue that the stock was in a down trend. Doubters just have to do some work and read my previous posts. We'll see if the commentary works out... probably sooner than later.
This simple chart unequivocally shows KMAG in an uptrend channel. Furthermore, the upper resistance line of the channel recently is continually penetrated to the upside. When the price closes above that line, snaps back to the line and continues upward, then an accelerated rising trend channel is in the works. In the process should closes above the major resistance at .014 occur then a major long term rally is in place.
Volume on Friday was 2.5 million and nearly 700k of that was on down ticks. Velocity is to the upside. When volume starts reaching 5 to 10 million shares per day with continuing upward momentun, a major bull move will be confirmed.
Yes, Narvo, increasing volume during an uptrend is a good sign. Correction I meant to say the pre halt price was .014 not .14.
2 charts. One shows the uprtend channel with closing prices and has been accurate with an acceptable deviation above and below the mean. That is points poking above and below the resistance and support lines.
The second chart indicates Open, High, Low, Close (OHLC) prices. This chart has more pokes above and below the channel which makes the channel less clear. Of interest is that in recent days there is an increase of pokes above the resistance line. This indicates momentum pressure to the upside. Today's intra day penetration of the pre trading halt price of .14 suggests that level may soon be broken to the upside on a closing basis. That could be a precursor of an accelerated uptrend.
While the post suspension price crash break point is .014 (red), the stock is now against pre crash resistance in the .0125 area. If these levels are surpassed then .016 is the next resistance with a possibility of a trading range (green). Should these levels be broken resistance on the the next chart comes into play. If those levels are broken then long term resistance levels should be watched on the third chart. In a selling panic scenario the rising bottoms line (first chart, blue) now at .006 - .007 has been reliable support.
.014 is the next significant resistance level to overcome. That is the point where the suspension breakdown occurred. Meanwhile .012 is an obstacle being the resistance level of an uptrend channel (green). Should .012 turn the price back down there is support at .01 and even a possibility of another traverse of the channel down to .006 - .007.
If .014 is surpassed the next resistance levels are .0165, .0185, .021 and .029 in the intermediate term. Should there be a news related high velocity move, these resistance levels could be overcome with a high volume breakaway gap that wouldn't need to be filled.
Thank you Tung Tung! I can't wait until this chart is no longer valid and the increments are in dimes.
The "charts don't work with grey stocks" litany has arisen again. Technical analysis does work with KMAG. The red arrows indicate technical resistance points that I posted or told friends about. On many of these occasions the psychological atmosphere was exuberant. I warned that the chart demanded caution and on a couple occasions I was called a basher. Being negative about the Stock price of KMAG doesn't equate to being negative on the company.
The green arrows are buy signals where I bought and posted that buying was a low risk prospect at these levels. Friends and myself were able to accumulate because volume was high at these levels while panic selling occurred.
Despite any arguments, pro or con about the company the stock has been tradeable with ample volume at reversal points.
Thanks for the insight lowman. Should KMA attain a lofty PE ratio as a result of a short squeeze, the common knowledge is that the unsustainable level will drop back to a lower average. The share price would drop accordingly.
An alternative is that the PE will drop as a result of a dramatically increasing revenue flow as new business comes on line. In that case the share price could rise as the PE ratio drops.
We know that short squeezes produce wild quick price swings that confound traders. Perhaps a leveling factor will be a news stream projecting significantly increasing revenues.
One good thing about starting a new chart is that we can start an Elliot Wave chart and know absolutely where wave A begins.
Pigs, the common knowledge seems to be that KMAG ends and Live Track begins. There will probably be a period of time while KMAG still trades after the announcement. During that time the price could move significantly and many people may want to take profits.
My concern is to not get caught up in the fear/greed maelstrom and sell without foresight or perception. I must keep in mind my sermon, when this moves from .10 to .11 I am not making 10%, I am making more than 100%. So if I take profits, where am I going to put my money that will get that return? Furthermore, considering the predictions that this will rise above $1.00 I would try to hang on to all I have as long as I can.
In regards to a new chart, we have to build a database to get predictability in the intermediate to long term. But as I said the momentum indicators could give us somewhat good short term signals. But I am not ruling out such a dramatic move that no indicator will be right on until the initial impulse wave matures.
I agree Pedro. Wait and see.
Recouping our initial investment for the disciplined trader is done at a 100% gain. For most of us that would be at 2 or 3 cents. Recovering the "seed" money at .10 or .20 puts us in the casino category. So if we are gambling let's do it to win big.
Putting GTC orders at the .10 to .20 area at this time is not the best bet. You could get your dime while the price flag poles to .60. Making a mental stop at .10 - .20 may be prudent.
However, to put the odds in our favor we must work a little harder. First, when the PR comes out read straight for the "forward looking statements" and get a grasp on what the future revenue expectations are. Then do some math with PE ratios and earnings percentage estimates and we may come up with a profit taking point more like .45 or .60!
When the stock begins to rise there is an alternative to putting in a preconceived sell order. Watch momentum indicators. Level ll is not a necessity. Use a charting service like bigcharts or barchart. Set the time frame for 1 day, two days or five days. it is best to watch several time frames. On the one day - two day charts set the frequency to 1, 5 or 15 minutes. Then select at least 3 momentum indicators: MACD(Moving Average Convergence Divergence), AD(Advance Decline), OBV(On Balance Volume), RSI(Relative Strength Indicator), Stochastics and Bollinger bands. When these indicators reach historic highs and/or start rounding over then it is time to consider profit taking.
Some long timers talk of taking profits at .20. What is that number based on? If it is merely arbitrary perhaps some deeper thinking could go into selecting a sell point. Paying attention to revenue estimates and doing some math could determine an educated sell point. Watching indicators or buddying with someone who does could get us out at a better timed point.
An alternate thought is, Why sell? Any consolidation could be short lived as frequent news is likely to appear when KMAG comes out of the dark.
The point is, why sell immediately after such a long wait, when just some more waiting and thinking could increase profits exponentially.
Some short term chart vandalism occurred with a puncture of the support line of the uptrend channel (blue). The channel could still survive with an up day tomorrow, but it's trustworthiness as a trading tool is diminished. The failure to successfully test .01 (magenta) indicates it's failure to become new support.
All this is not tremendous bad news. .01 may not be support but after last week's breakout it is no longer formidable resistance and the next level to challenge is .014 (red). There is still intermediate and long term support (green) at approximately .048 and .04. Furthermore, the blue short term uptrend channel is not to be dismissed unless the price fails to break above the lower support line at near .007.
The bold believers could buy in this area with small orders at .006, .007 and long shots at .005 and .004. Small orders because selling today accounted for only about 1/4 of the volume.
Lowman is right as usual. The chart experienced a breakout of intermediate term resistance at .01.(red) It has made a snap back retest to .01. If price goes up from here the .01 level is new support. A price move below .01 is not a big concern as the uptrend channel (blue) allows for closing price of .0075 at the lower support line of the channel.
Other chart patterns indicate a bullish trend:
1)The long term declining tops line (grey) has been broken.
2)There is a fan formation of rising bottoms support levels. ( the two green lines and blue line)
3)The wedge formation has been broken to the upside. (red resistance and green and blue support possibilities)
The chart is now in fully bullish mode. Any downward spikes will be met with strong upwardly biased support levels.
Despite lack of rumored imminent news the chart's uptrend persists and the price is compressed against resistance at .01 on two days of high volume.
The (red) long term indecision triangle pattern has been nullified with the recent breakout. But long term support remains along the rising bottoms line (red) currently at .006 which held during an intra day challenge this week.
An intermediate term rising bottoms line (blue) is the base for the uptrend channel. However persistent resistance at .01 has created a wedge (blue). Should that pattern be broken to the upside with a close above .01 then a new bottom would be formed and higher resistance levels could be challenged at the previous peaks: .014, .016, .021, .03 and beyond.
Malibu, It's good to see you in a position to provide your clear thinking during the next stage.
Congratulations Samson. I appreciate your level headed commentary which will be important in the times to come.
The chart still shows KMAG in an uptrend channel (light blue) with long term support (blue) in place.
2 weeks ago I suggested that after breaking above long term resistance of the (red) downtrend, without news we could expect the price to drift downward along the former(red)downtrend line. That is what is occurring. Until .01 is broken to the upside on substantial volume the message is "hurry up and wait."
Despite the silence from KMAG the chart is in an uptrend. The long term indecision triangle has been nullified when the price punctured the the declining tops line (red) that turned back the price 6 times since 2011. Now KMAG is trending along an intermediate term rising bottoms line (red). There is substantial resistance at .01 and until that is broken KMAG is locked in a wedge with support at the red rising bottoms line and the blue resistance at .01. Until this pattern is broken all arguments about KMAG have not affected the trend which is indecision with an upward bias.
Just an observation: the last PR was met with such skepticism and rancor that I sympathize with the silence from the company. But the fact that the price hasn't collapsed indicates that there is faith that the outline in last PR will play out as evidenced by the uptrend indicating there are more buyers than sellers.
OK here come my "if's"
If #1. If we are putting in GTC sell orders above a dollar then those shares are effectively taken out of the float until filled. During a short squeeze the result would be an accelerated up move. Then the purpose of these GTC orders would be to "stick it" to the shorts.
If #2. If the reasoning behind the GTC orders is to take profits during a spike, the execution price should be placed at a reasonable level. There will probably be willing sellers at .25-.35, .45, .60, .1.05 and 1.35. These are previous resistance levels. Once any these levels are met with a declining RSI, MACD, AD and other momentum indicators, a retracement would be expected. Fibonacci calculations would suggest approximately 35%, 50% and 65% retracements after the short covering rally plays out. The astute trader will see when a near term top appears for profit taking, and at what level to get back in.
The first "If" is easy to act upon. Put GTC's well above $1.35, the long term top.
The second "If" requires more studied action and nimble tactics in determining where to place orders.
This analysis is only regarding a short covering rally. The factor of fundamental revenue news is a different element to consider, and a significant element.
The chart is still showing uptrend patterns despite the Friday takedown. This was not a high volume event and represents around $25,000 in trades. Last week the chart suggested that until volume picks up we can expect wild swings and and a general downward slope along the declining tops line of the red triangle. The price is now again within the triangle, but the pattern itself was nullified when broken to the upside. Now the red uptrend line is long term support at .005. The drop to .0065 demarked a near term up trend channel in blue. With .01 being formidable resistance that blue uptrend may become a wedge with the purple line as the horizontal and the lower blue line of the channel as the diagonal.
Last week I suggested that until there is news to create volume, we can expect spikes in either direction and it would be tempting to get pessimistic or over-exuberant during these moves. If one accepts the future projections of KMAG's fundamentals then now is a buying opportunity. If one is cynical the best selling zone has been around .01.
The charts I posted on 12/14/2013 are still valid, channels are holding, and declines at this time should be seen as buying opportunities if one accepts the fundamental assumptions being posted.
12/14 charts link
The intermediate term top at .01 continues to hold on a closing basis. On the cup and handle chart the handle is being drawn out with parameters being .01 and .008 on a closing basis. On the second chart I suggested two uptrend channels which are still possibilities. I also indicated that the price could creep downward along the descending tops line of the indecision triangle (in red). If there is insufficient volume to stimulate a breakout above .01 the price could continue down this line toward .007 later in January. So far KMAG is within the upward trend channel (in blue) with a bottom objective of .007.
So .007-.008 seems to be support and .01 resistance. But low volume "paints" beyond these levels are not unlikely. The traps here are to buy above .01 while the volume is low and to be shaken out below .007 if there is a panic washout.
If one accepts the information in the Oct. 23, 2013 PR and the updates by posters here, and as Djknows says has faith, then buying anywhere is a good plan as once .01 is surpassed on high volume, much higher levels are predicted by long term charts which project at least 1.35 in the long term.
Merry Christmas to you, the ones you care for and especially to all who are less fortunate than us.
Two charts have important updates. The cup and handle formation has indicated that the bottom is in and a new uptrend is in place. The first major resistance beyond .01 is at .014 where the massive break down occurred after the suspension. If the latest PR is realized we may expect an upward burst similar to that seen in March. In that case, with some hesitation at .014 we could expect to see a run straight to the .02 area and probably higher. The Elliot Wave theorists call this the initial impulse wave, relieving pent up demand. How high this wave goes depends on momentum. Until this wave occurs backing and filling in the handle channel would not be unexpected with tough resistance at .01.
The next chart suggests two possible uptrend channels, one in green and one in blue. With no uncertainty the red indecision triangle has been broken and the breakout has been retested on higher than usual volume. A possibility would be for the price to creep downward along the declining tops line (red) into January. Resistance of the two uptrend channel possibilities is at the .012 - .013 area and long term resistance at .014. Again, another possibility would be a spike up on long awaited news that breaks the price out of these trend channels and into resistance level areas that are best shown on a long term chart. .05, .12, .26 and ultimately to .45, .60, 1.05 and 1.35.
Chag, if I were to pick a number and not look back I would look at a long term chart. I attached it below. It looks like .12 and .30 are reasonable points if you hold any credence in Technical Analysis.
But Fundamental Analysis is quite important for making a sell decision. I wrote, "When the fundamentals are made public we can calculate a fair value and project growth." At that point different price objectives than .10 and .25 may appear.
People, myself included, neglect to do the arithmetic. When KMAG reaches $1 and then moves up a nickel, a first conclusion would be: that is only a 5% gain. In actuality, having bought at .01, that is a 400% gain.
We hear talk of bailing out after huge gains and finding a stock with a higher gain potential. But it is important to not base judgment on price gain as much as percentage gain.
We know, technically, reaching $1.35 is merely retracing past history. When the fundamentals are made public we can calculate a fair value and project growth. We may find that the most prudent option may be to simply buy and hold.
According to precious metals gurus gold and silver is massively shorted on the Comex by the likes of JP Morgan and the other biggies to direct investors towar bonds and equities.
The junior miners get hammered when the metals are in a down trend. Some are looking for gold to bottom at $1000 so this misery is a buying opportunity of a generation.
Pigs, .......... Thanks for that, I have respect for the analysis you have shared and am honored by your statement. To update that chart, the dip into the .008 area and possible 7's is occurring and as you know could linger until news arrives to generate volume.
Jaime! I hope you saw my last chart. Things are looking up figuratively and literally. Thanks for introducing me to Tommy. Three things I can blabber endlessly about: talking music & TA & CHARTING.
I'll be rooting for your run Aqua, and for KMAG's approaching run. Thankfully, during my visits I am Aquaman at Tunnels on Kauai where the sharks don't get inside the reef.....I think. I do think that KMAG will be showing it's teeth and taking a bite out of the RFID market.