Marketgems Earnings Trader- Trading Strong or Weak Earnings Growth

[jenna]

RIMM still huge.. after selling some more incrementally still expect this "baby huey" to hit 95. Here is what we posted on RIMM today in the daily newsletter.

*enter this play cautiously. RIMM has rallied after a 5 bar "pause that refreshes" just below major support of the 20 ma Important that RIMM break the 89 area (20 dma) so it might retest the former 52 week high. 90 calls an alternative

[ed. comment] You don't buy stocks that are dropping like rocks in the midst of the tankage, you buy strong companies that back off 52 week highs and pause to refresh before continued upside. Of course we did pick up beaten down stocks today but we are skeptical and although we got some sort of bottom, the bottom might just be the same pause that refreshes however this time for increasing downside, so trade cautiously.

There are 2 kinds of 'continuation patterns' in the "pause that refreshes" There is the continuation of DOWNSIDE after the pause for accelerated downside after the stock takes a breather (possibly the likes of KLAC, SNDK, ELX, QLGC, and that group) and the "pause that refreshes" for upside for a stock that has soared after the earnings report, continually proved it could recover upside after "bull flag" pullbacks and CONFIRMS our pattern in real time and not just prognostications.