NeoMedia Technologies, Inc (NEOM)

[jonesieatl]

"how TA/charting can predict a blockbuster anouncement"

chartist provided one possible answer to this, and there are probably more:

"There is no way a chart can predict your scenario (a blockbuster PR scenario) unless someone is buying prior to the announcement at the end of the day and that would get reflected in "unusual" chart volume."

Strict adherence to TA can certainly lead to the possiblity of being "out" when a non-leaked blockbuster PR comes out, and strict adherents to TA understand and accept that possibility. There're all kinds of ways a pure trader could get "bit" that way, but it's all just part of the Greatest Game on Earth IMO, accepted as pragmatically and non-emotionally as possible by TA devotees.

Let's say there was a nice runup which culminated at a double top right at an existing long term downtrend line. Shortly thereafter, the stock retraces a bit, maybe even more than a bit, and no news was to be found. A TA guy might conclude that the runup (and subsequent retracement) was technical in nature, or that there was the rumor or expectation of news that didn't pan out. Then, right after I pat myself on the back for "calling" the top and selling there (either all my shares, or as is more likely with a TA-student guy like me who also has GOOD REASON to believe the stock is ultimately a gorilla in the space, just selling those additional traders picked up at a technical bottom to be sold at a technical top) ... a blockbuster PR comes out and the stock gaps up 100%, one of those gaps that will NEVER be filled. (From my mouth to the Stock gods' ears, thank you).

If I was out all the way, then the result was: I gambled and "lost" and now have to chase and start my re-entries at a higher point, most likely after THOROUGH examination and hopefully flushing out all potential retracement, etc etc. That gap would not be the end of the world by the way, as presumably I already made money with several trades over the preceding weeks/months, perhaps way more than enough money to cover the cost of my higher re-entry, if I choose to look at it that way. If I had only sold some traders at that top that I picked up lower, hey, am I going to be complaining much after seeing my core holding go up 100%? Nope, just gonna enjoy and tuck the experience away as one more datapoint along the learning curve.

Chartist mentioned something else that applies to me in a very big way. The TA part of all this gives those of us who "need it" (and I admire those of you who don't just as much) a profound sense of control in situations might otherwise seem totally out of control, like the situations that evoke those "why did my stock go down!!!???" posts that are so frequent on so many boards.

Maybe we (TA proponents) are all "control freaks" at heart LOL. I know I've got a bit of that in me.

All JMHO and sorry for digressing a bit from chartist's simple and probably sufficient answer to "how does TA predict a blockbuster PR". Sometimes it does, sometimes it doesn't, one has to be prepared as well as possible for all eventualities.

Now I'm REALLY outta here lol, y'all have a good day.

jonesie