Posted by: dalcindo Date: Wednesday, July 30, 2008 9:10:00 AM
In reply to: dalcindo who wrote msg# 487 Post # of 497
Re: INSM - TA explained:
(link for original message)
Here are my Q&A regarding your prior request:
1 - What is the main difference between your 1 and 2 scenario?
In scenario one, the price takes off from prior close; in scenario two, the price finds support at prior day's low, but does not go any lower. The technical difference would indicate that in Sc.1, the bears are absent and the market for that particular stock in made up of bulls exclusivecely; in Sc.2, some residual bears are trying to counteract the bulls. In the future price action, this often indicates that the next candles, or trading sessions are expectedly bullish, making for a nice swing trading set-up.
2 - And as for part 3: I thought about that one myself as well, and the basis for .62 that is earlier resistance levels there, correct?
First of all, this 0.62 resistance should turn to support. So, i believe you meant to call it support in your question. In any case, to answer in short, yes. The prior resistance level is found at 0.62, which should turn support. Additionally, the crowding of candle tops at that level should also give it away visually.
Now, always be mindful that such crowding pattern does not provide any information regarding the strength of the resistance/support level. Typically, a crowding of prices closing around a given value associated with a volume increase at that same level would indicate the strength of that resistance/support level. Price x volume are the very least skeletal technical indicators needed to decipher that strength level, almost always.
3 - Would you try to get 62 there or go a bit higher?
Well, setting up an exit above a price that was chosen as a likely support level would not make sense. If 0.62 is chosen as a support target, then set an exit strategy below this price, so that any violation of this price should trigger an automatic exit. I don't believe that trading services provide such automated triggers when trading with BB's or pinks, so a mental set-up is what needs to be used instead.
4 - And your comment on other scenarios too risky, what did you try to indicate there? That if the price action did not follow 1,2 or 3, that i should be very wary of different movements maybe negative? Or just that other scenarios are too hard to predict?
By too risky, I merely implied that my trading strategy is based on best possible events. There are a multitudes of events at any given second, day or month. On a weekly or even daily chart, a bullish set-up for this particular stock would require scenarios 1 or 2 for me to get involved. Any other combination of event at the onset of next trading can happen, but of the possibilities for bullish scenarios listed, any others would require a lesser price action and therefore a less desirable trading set-up.
To be sure, there are no negative movements, as you put it. The price is mindless about which trader does what. Instead, it is up to the trader to be mindful about what price scenario does what. In your case, though, since you are an investor, then I would assume that you are willing to go through ups and downs and not necessarily be too mindful of the current price action, but instead of the overall picture.
Now, to finish this comment, I looked at the chart again, which provided me with the advantage of time elapsed since our last exchange. Turns out that the chart indicated a scenario much like #2 at the onset of the new trading week. however, the current price action does indicate a persistence of bearish sentiments, that the price still belongs to a downtrend.
More specifically, indicators such as the 14-RSI, 20-CCI, 14-STO, 9-MFI, 9-CMF, PPO, ADX and A/D lines provide a technical mix: all are confirming that the predominant direction is bearish, BUT that some of them also show a break in this downtrend. Such picture may be an early indication of an early bullish reversal. And i believe I mentionned that on our last exchange. however, the current RSI stopped at or below 60. IF this weeks ends with a RSI < 60, then the downtrend is intact and likely to persist. This would be especially true if the recent price high remains unchallenged.
Hope these comments answered your questions. Of course, they are subjective interpretations of this INSM chart, in which I hold no position.
D.
Message In Reply To:
i am very much long insmed and re-evuate on pipeline milestones.
Currently see a lot more chances in bridge financing, partner with equity stake or indication sale than dilution, although that might happen in a negative scenario/
What is the main difference between your 1 and 2 scenario?
And as for part 3: i thought about that one myself as well, and the basis for .62 that is earlier resistance levels there, correct?
Since there are risks still but i had intended to put an order in at 0,63 or 64 regardless.
Not sure what price to set it at yet since i wont be around.
Would you try to get 62 there or go a bit higher?
And your comment on other scenarios too risky, what did you try to indicate there?
That if the price action did not follow 1,2 or 3, that i should be very wary of different movements maybe negative?
Or just that other scenarios are too hard to predict?
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