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Will, as you are aware 5/10/20 is the basis for safe profitable trades, however I also like to get a bit promiscuos at times.
Rubber band trades are definately riskier, but can work great for those of us that can daytrade. Actually I think you have had two rubberbands back to back, just hope you learned a lesson with HWAY. The three charts were trending down, earnings came out and other than missing on Rev's they were good, but when in a downtrend, news releases seem to follow the trend, and the pps goes the same way. HWAY showed some improvement today, but the overall trends are still down.
LOL Villas, Not sure if that was a compliment or an insult! Either way I think we need to get together again and discuss it over a few drinks! You going to be in town anytime soon?
As for the research, still doin it, just dont open Yahoo much anymore, I know you are the mathmatician in the group so I figured you're the one with the brains. Same premise still holds, even though HWAY seemed to blow my theories out the water today, any thoughts?
Design333, I'm not ignoring your post, I'm just trying to figure out the best way to respond to it. You asked some questions that lead to alot of thought on my part. It may take several post to address them.
I'll start by saying I'm impressed with the fact that you are using 5/10/20 ma's on your chart.
I think I can see where you might be seeing a head & shoulders on a 3 month chart, but honestly, trying to figure out chart patterns on a three month chart is not the best time frame to be trying to predict chart patterns. Chart patterns such as head and shoulders, double bottoms and double tops are much more reliable when read in a longer time frame such as a yearly time frame.
My 5/10/20 system, once understood,is a much more reliable way of investing in stocks. 5/10/20 usually leads any chart pattern, and it also takes the guess work away. If a chart pattern is developing, I can guarantee you that 5/10/20 showed it before the pattern developed, all the pattern does is confirm what the 5/10/20 has already shown you.
Chart patterns such as h/s and double bottoms are great for the uninformed, It takes a yearly chart to confirm chart patterns, not a 3 month chart. If you look at a yearly chart you will see that REV is no where close to a H/S or a double bottom, what it actually shows is channeling.
Tomorrow I will try to post a chart that will explain this to you.
Please do me a favor, and do not listen to the ones that think they know TA, Those people can convince a Nun to have sex with me, but in the end was it the right decision?
As for REV, the daily chart looks great right now, but the weekly and monthly tell a different story. REV can be a good one soon, but patience is a virtue.
As of right now, look's like youve recovered your losses, might be a good time to bail.
Hey Will,
Been looking at HWAY, I'm not telling you what to do, but if it was me, I would Definately sell at eod today. There is alot of weakness in all 3 charts.
If your "GUT" is right and the earnings are good, than you can buy back in tomorrow, and all it cost you was a couple commisions. If your "GUT" is wrong, than you can expect a mass exodus and who knows what price you will get out at.
JMHO
Hey Design,
Happy New Year, Everything is going well for me. This board will be alot more active now so feel free to bring any questions here.
Hello everybody, Just got back in town last night, trying to catch up now.
First off I have no problems with discussing and learning about options here. I am pretty much clueless when it comes to them, but it is something that I've always wanted to learn. I've looked at the link that Deadb440 posted and its very educational and looks like it will serve the purpose well.
Will, congrats on your lil short play, I'm glad to see you exited it already cus the overall chart looks pretty damn good. Might even put it on the watch list.
I hope everyone had a good New Years day now its time to make sure the rest of the year will be good.
Lock house here is the monthly for GM, When looking at weekly charts I like to use a minimum of a two or three year chart, 1 years are too flat.
Looking at your daily chart, I would not use macd as a entry point due to the fact that both fast and slow lines are still negative which means its under the ZERO basis line, For short term trades the 5/10/20 cross would have been the right indicator.
Macd on a daily chart is not as good as an entry indicator as it is on the weekly and monthly charts. Macd as an entry works best on the weekly chart. And as to oo-bucks post about PPO as an entry indicartor or sell indicator, It is virtually the same as macd compared side by side, so either one works.
I'm getting ready to head out of town in the am for a few days I'll be back Wedensday, so Happy New Year to ya if I don't make it back to the puter today.
Will updated Ibox.eom
Lock, Will's advice is very good. I will add my two cents also.
Earnings reports usually always have an effect on chart patterns, and believe it or not, chart patterns can actually give you an idea whether or not earnings reports are going to be good or bad. I'll explain.
When a stock is in a strong uptrend (weekly and monthly charts are definitively upwards) than chances are pretty good that the next earnings report will be favorable and help continue the trend. The opposite applies in a strong downtrend, strong downtrendleads to poor earnings report.
Where it becomes difficult is when long term charts are flattening, heck throw the daily chart in there too, is when you have no idea what the report is going to do. When that is the circumstance, I would not recommend holding through the report, sell the day before, and buy back in later if the report is good. Better safe than sorry.
You must remember all trends come to an end, so a topping or bottoming of a chart can be greatly effected by an earnings report, good or bad. And remember, never listen to the advice of posters on message boards they don't know any better than anyone else what the results of the report will be, only company management knows.
Will, I guess I need to add another rule to the Ibox. "When in doubt, get out!"
SGP, Daily chart is weakening, noted by consolidation of the pps @ the 23.80 level along with a flattening 5 dma. Macd is also flattening out plus rsi indicates oversold for the last 3 weeks. The weekly chart indicates a pullback to the 5 week ma is possible. Overall weekly and monthly still look good, but why give back profits, since the daily is weakening, if it was me I'd sell, wait and look for a bounce and buy back in if it happens. Knowing that a bounce back up off of lower levels is likely due to the strenght of the underlying trends.
TALX,
My buy in point for talx is a weekly close over 27.50, looks like that isnt going to happen, the daily chart has alot in common with SGP's flattening 5dma ect.
The differances are talx weekly chart is alot weaker than sgp. Couple that with a downgrade and I think talx can suffer a significant drop in pps. Early in the weak the chart looked realy good but this downgrade can be the start of a true reversal.
I've done some learnin as of late, and I've realized a couple things. After going through many previous post in the last few weeks, I've realized how many good stocks we have missed out on. Many posters on this board have brought up good stocks only to be forgotten about. This chart of Smith and Wesson is a perfect example. Willsimon originally posted this stock on March 7th 2006 at that time he posted:
Posted by: willsimon
In reply to: None Date:3/7/2006 9:47:37 PM
Post #of 2072
"One last one for tonight: SWB. If it breaks that double top, this sucker could be in for a nice ride. Looks similar to the chart I just posted, but MACD looks better (tighter) and volume remains strong."
From the time he posted this it went from $6.00 to 15.00, More than 100% gain. And we all missed it because it got forgotten about by most here.
Lesson learned: When someone comes up with a stock that has a great chart that was found using the 5/10/20 system, it's one that should not be ignored. Rather it should be watched weekly if not daily.
So what I want to do is develop a list of 10 to 15 stocks that we all can play or watch, Price per share doesnt matter as long as the charts are good. I also think we should watch some stocks that are downtrending so we can learn during the downtrend.
I will start the two list, please feel free to put up whatever stocks you want for review to see if they are worthy of the two list.
Bull Stocks
#1 TALX...By Willsimon, Very great potential for a longer term buy and hold.
Bear Stocks
#1 SWHC...Formerly SWB...Willsimon, This stock shows significant selling pressure after a great run.
If anybody has any suggestions to improve upon this new board philosophy, please let me know. I will also post these list in the Ibox so that we dont forget which ones we are watching.
Oh btw here is swhc chart.
Hey Will, TALX is looking real good right now.
The daily close today was above $27.50, very good since the resistance was at 27.50 plus a nice bounce off the 10 dma support level. MACD is also bouncing back up another good sign.
And it looks like cash is starting to flow back in per the cmf.
The only real uncertainty is the weekly candle, it looks great right now but keep in mind it is only reflecting one days worth of trading. With that said the strength of the daily chart will probably make for a nice white candle at weeks end. Also the weekly MACD is getting a fresh upwards bounce, another indicator that starts to make me feel all warm and fuzzy.Oh by the way, 5/10/20 cross is looking very nice.
As for the monthly chart, there are only 3 days of trading left for the month, so that candle should hold up well, 27.50 is the key resistance on all three charts, and as long as bad news doesnt come out in the next three days which I dont think it will, the monthly charts next resistance level is $32.00. Hey I'll take a 5.00 gain, and a break of 32.00 will be just fantastic.
Nice find, this is a chart that has alot of longer term potential. I will try to keep following it.
PS: I don't see a Cup and Handle, but I do see a fresh 5/10/20 cross.
Merry Christmas and Happy Holidays to all.
May you all have a safe and happy holiday season.
This is just a lil string around my own finger, Go over SWHC, and past lessons. Start a list of 10 stocks for this board and watch daily.
Vern, a question for you.
Some thing has been bothering me about the design of the SII, I would love to hear your opinion.
Your original design and the design of the S1 was significantly different from the current demonstrator. Both your design and S1 had a large flat top, which I will assume was for the purpose of additional solar film to produce maximum voltage output to power the strat and its components.
This new SII is round on top, which tells me there is inherently less surface area directed at the sun at any given time. So my question is: Has solar film and battery technology developed so much in the last year that it no longer requires the same amount of sq footage to create the same ammount of power that was required by S1 and your original design?
By no means am I an engineer or would I pretend to be one, but common sense tells me there is a HUGE difference between the two designs. When I first saw the SII, I was extremely disappointed, and I bet alot of the people at this board would privately admit the same thing, Ill be honest, with this design I have doubts that this thing will ever work. Please explain to me and help me feel better that this new design will actually work.
TIA
Satori, I might have miss read your messages, So I looked closer at BIGN. The chart is actually shaping up nicely, But a break of .02 is crucial, if that doesnt happen than a freefall can be expected.
I just don't like stocks with such low prices, especially ones on the pinks. There is usually a reason for the pps being so low, and that is usually no earnings, massive dilution, crappy management just to name a few. People do get lucky with them if you properly play the pr pumps, otherwise as a serious and safe trade, they are the last place I would go.
See GTEM as a perfect example.
This post has nothing to do with the 5/10/20 system, However I do think it is a perfect example of the old saying "Buy the rumor, Sell the news"
I don't dare post this on the GTEM boards for fear of death threats, lol. This is also a great example of how falling in love with a stock and not knowing how to read a chart, can be financially fatal.
>
No prob Satori,eom
Hey Will, Nice pickup on the cmf vs pps when it comes to NR and the length of pullback. I've always used cmf as pretty much an after thought, even though it is on all my charts, but now I will look more closely at how a pullback is effect in relation to cmf. A case of the student teaching the teacher, good find and thanks.
Hi Kenl, Here is your monthly chart. I put alot of explanation up for this monthly chart, being the monthly chart moves so slowly, you should not take what I said on the chart and apply it to the shorter term weekly and daily charts. The are much quicker so different rules apply.
Lockhouse,
I've been a member of stockcharts for so long I forgot that the free side of the site doesn't allow monthly charting. I'm glad you reminded me of that fact. As for a membership, that's a personal decision for you,personally I love it, but I think you should wait a lil while until you become more comfortable with with reading the charts. As for the monthly charts, just ask here, I or someone else will be happy to post it for you.
Enjoy your family time, much more important, we'll see ya when we see ya!
Hey Will...
As For NR,
I agree with your assesment The Monthly is in nice shape, as you correctly stated the weekly chart is overextended and showing signs a pullback is likely, so this puts all the pressure on the daily chart as too entry point. Being the weekly is so overextended I think the daily may need to bounce off the 10dma as opposed to the 5dma. My opinion is untill the weekly settles down, I think I would wait on any new entry point. But if you already own shares its deffinitly a keeper for now.
SGP,
To answer your question, I do believe the strength of the trend can overide a oversold RSI, Ive seen RSI be oversold for months at a time, due usually too, strong trends. I have been trying to find something wrong with SGP, but damn I just don't see it. a small pullback is possible but for a longer term buy and hold, it looks great.
Good Job.
BTW...Just added SGP to my watch list.
Hey Dead,
No I havnt been tweaking the scans, just the system. Your scan still works well.
I honestly don't pay much attention to volume at all, and people usually take issue with that, but heres my reasoning. If you are in a trade where all your trends are with you, than the volume will automatically be there, and for the most part it's good volume. Volume comes two ways, buying and selling, just because a stock is trading alot of volume doesn't mean its good, everyone could be selling. For the way I trade, volume isn't a concern even though 99.9% of the people out there would say I'm crazy. My system has worked for me with or without volume.
The only time volume is a concern to me, and still doesnt matter that much is on daytrading pr's, but obviiously when a good pr comes out the volume will shoot up and visa versa. Or on a stock that only trades a couple thousand shares a day cus that makes it harder to get out.
Here's how I trade,
When looking for potential stocks to play, the 1st thing I look at is a monthly chart, if the previous months close was not above the 10 mma (Month moving average) than I will move on to one where it is. This puts the heaviest of all trends on my side right away. Since the monthly trend changes so slowly I can feel comfortable that this upward trend will last a while. The 2nd thing I look at is the weekly chart, I want to make sure that the weekly is not weakening in a way where it will start turning around the monthly, but chances are that if the monthly is strong than the weekly is usually strong also. So than I will wait for a good entry point on the daily chart.
When I find 15-20 stocks with a Good monthly chart, than I will only play the best of those, once the monthly chart starts to weaken, than I will find another one to replace it with.
I dont typically run all over the place looking for new "Hot Stocks" Hell Ive been in and out of some stocks for a couple years because the monthly never went negative. I just play the fluctuations on the daily and weekly charts.
Hey Lockhouse are you using stockcharts.com? If not I highly recommend it.
To answer your question on exit points it basically depends on the timeframe of the chart I am looking at.
For instance if I only looked at a daily chart, than I would probably consider selling when the 5 dma flattens out, and definately sell on a cross below the 10dma. But I will also look at the 5wma on a weekly chart to see if it is still strong(Which means poiting towards 1:00 to 2:30 on the face of a clock) If the 5 wma is also showing a slowing down (Closer to 3:00) than I will probably sell on a flattening 5dma. If The 5 wma is still strong Than I will hold a flattening 5dma, with the expectations of further upward movement.
But on any sharp move down (4:00 to 5:30) on a daily chart where the 5 dma crosses the 10dma...thats a no brainer out.
Using only one chart time frame, usually daily for most,is the most common mistake that most TA people make.They usually end up scratching their heads saying "How come it didn't do what I thought it would do"? Well the answer is they did not take the underlying trends into account.
Without knowing what direction the underlying trends (Monthly and Weekly) are in you are not looking at the entire picture that is available to be seen. I've seen many times a great looking daily chart, perfect 5/10/20 crosses, macd and rsi looking good ect, only to have the chart turn bad in a couple days. Well I can guarantee you that if you look at the weekly or the monthly charts one if not both are still in a substantial downtrend. And than you say to yourself, "Ohhh, Thats why"
The best way to make money in the stock market is to make sure you've got all three trends in your favor, otherwise you are making your trades much riskier.
Hey Design,
AOOR, I agree a much lower price is still in it's future. Try looking at a 2year weekly chart, you will see it there.
Heres another one...
>
Heres a 25 year monthly chart for the Dow Jones Industrial Average. Any Opinions? Warning it's a large chart! Ok I just realized I missed a few things,Ill just update and add another one.
Hey Will....
I think you might be doing a bit too much thinking as of late, predicting patterns is not part of the 5/10/20 system, the 5/10/20 absorbs those without having to try to find them.
Remember this is simple stuff, 3 lil line and a couple indicators is all you need, hell as of late, all I use as an indicator is macd, all the others are just more things to confuse you and are of no real help.
Let 5/10/20 be your guide and macd your confirmation, predictions are not what we are about, we react instead.
Go ahead and pull up a monthly chart, you will see what I mean about the 10 mma, The monthly trend isnt something I've talked about here very much but It is a real value in expaining why a stock suddenly stopped a move that should have continued.
OK Will here is the gtw chart, I wanted to put a monthly chart with it, but no matter how I save it, the monthly will over write this one, and I'm tired of loosing the annotations so I'm not going to try it again. But this should get my points across.
>
LOL...That was good, been trying to post replies to your charts up here all afternoon, but things just arnt co-operating. Ill keep trying though.
Is anybody else having problems saving stockchart charts? Especially annotated ones.
Will, I feel you pain, as of 11:32 pm est time stockdharts is still not up, THIS REALLY SUCKS!!!!! My future depends on Stockcharts I Really hope they are back up by Monday.
Goin to bed, I will look again tomorrow.
Night all.
Pilgrim, you said "These" but I only saw FCGI on yor post. So here is an anotated chart as to a possible swing trade for FCGI...
Pilgrim, Merry Christmas to our troops and a huge Thank You to them also!
You are absolutely right the brave men and women that are defending our right to live the lives we are currently living, deserve all our respect. Just think what this country would be like without them, pretty scary if you ask me.
Anyway, I will look at the stocks you posted and give my opinion, give me a few min's.
Merry Christmas and a prosperous New Year to all!
I must say "Thank You" to all that still come to this site, most of all I would like to appologize to Will for being so "Un-available" as of late. Will has done an OUTSTANDING job keeping this board intact during my absence, again "Thank You Will".
I have been doing alot of research and refining of the 5/10/20 system of trading. I've come up with a few more "Tricks" but the basics are still the same. Will has done a fabulouse job explaining the basics, his leadership has been an asset to this board.
If y'all don't mind I would like to become a part of this board again and share some of the new knowledge I have developed in my period of absence. I also might ask for some help from you guys to help refine the theories I have been working on.
The only thing that I ask is that we keep this board to ourselves, I dont want a bunch of idiots trying to confuse facts with fiction or hope here.
Obviously everybody gets busy during the holidays, but after the 1st of the year look out, we all are going to make money.
Good Luck to all and may all have a good night!!!! LOL
Lockhouse,
You left me a mesage a few months ago. I appologize for being so late in responding, this is the only way I could find to contact you. If you are truely interested in learning how to properly trade stocks, then I am willing to share my techniques with you.
Please email me at gbsint@bellsouth.net we will take it from there. Put in the subject line 5/10/20 otherwise I will not respond. I need another apprentice, if you are willing we can discuss this further.
PS... The only reason I am responding to your post is because you sound like you are sincere and have a brain to go along with it. Two essential qualities!