iTalk Inc. (fka TALK)

[Ronin_Trader]

I said this back when I first came on this board...stocks like to put you through stress tests. The stocks will do a short run up fast....then pull back. But just when you think the pull back is over... It pulls back some more... But you tell yourself...it's ok I can handle it. However, that's when it pulls back even more and makes you almost feel sick if you hadn't sold.

At this point you are mad and can't take it anymore because you are kicking yourself that you should have sold at the peak... So what some will do is sell at the third low low pull back. Basically they will end up selling at the bottom of the chart. Some one like me will come along and notice the chart and see no red flags...and then buy at that point that the other trader could not take it anymore... However, he was better off holding... At times.

So, the next phase is the stock will run up right away after the pull back, or it will stall and look dead to the trader that did not sell at the bottom but held on. But now the stock is putting you through another stress test of how long you can hold before the big move up... I should add that this is for a stock that has no red flags... So the trader that passed the first stress test of not selling on the pull back to the bottom... He might then be put through the stress test of how long he can hold out until the real move up. So this trader may sell because he can't take it anymore and he sells as the stock trades in the channel. Not knowing that the stock is calming building up. A month latter that trader too is kicking himself like the trader that sold at the bottom because he sold because of impatient.

The end.