This is one of the newsletters I got (at 6:42 PM CST) in my inbox:
If you are having trouble viewing this message, .
ADXS Up 50pct Today EXM Stays Strong And Weekly Recap
Happy Friday Fellow Trader,
We had yet another profitable week with the various stocks we brought to your attention. If you are a new subscriber, you should be starting to see that our scanners definitely know how to shoot out quality trade ideas!
As we go over three charts from this past week, you should notice a theme and key concept you must master: the importance of previous lows!
On Monday evening we brought SMAK to your attention and it turned out to be a solid trade, assuming of course you monitored the lows. It opened Tuesday morning at .19 and within the first 30 minutes moved as high as .235 for a great profitable opportunity.
A bit too much selling pressure hit though, and shares began to retreat and as you see below, violated the low from the previous candle. This was the first major warning that the chart was “running low on fuel.” All in all, this was a great quick trade and now provides us with a valuable learning lesson.
On the 5 min chart below you will see that the 5min chart trend broke, which is ok sometime but then the stock has to charge back to new highs…so it’s a mix of using different time frames to keep you in a trade if it doesn’t keep going for many days you need to know what to use ..So if you want a trade that last for many days then you track the lows on the daily chart. If you want a quick intraday trade you use a 5Min chart or 15 min chart…..
Besides ensuring you do not get caught in a trade that is running low on strength, the OTHER reason you need to watch previous lows is so that you do not sell too soon on a stock that is simply “resting”, but still has plenty of strength left. Both EXM and ADXS make perfect examples of this.
When we brought you EXM it had just made a big move. The question at the time was “is there still strength left?” and sure enough, there was! It has moved a total of 24.6% since we alerted it.
It has been doing an excellent job of maintaining its lows, so this one really seems to have some muscle behind it. If you are in the trade, you should be watching the 200-MA (blue line). The shares are right up against it right now, so it’ll be interesting to see if they can break past.
ADXS follows almost exactly the same pattern as EXM did. An initial big move, a period of “rest”, and then explodes. We’ll say it again, you always want to be sure you are not selling too soon when all a chart is doing is “resting”, but still has strength left in it.
ADXS made an initial explosion, we alerted it to you, and as you can see, there was never a violation of the 50-MA (not even close to being tested!). After two days of sideways action where the previous lows were not violated, shares went BOOM today giving our subscribers an opportunity at a 63.4% gain.
For those of you still in the trade (first off, congrats!), watch that 200-MA valued at .077. That may provide some more resistance, but if the chart can go through another healthy rest period, there could be more fireworks next week.
It would be smart to use .0565 as the “fuel line”, meaning, if shares drop below that point, it could very well be a signal that the chart is running low on fuel.
We hope you enjoy your weekends! We’ll be hard at work looking for our next big trade idea which should come by Monday night…
Enjoy your week-end
Michael
Visit my IHub board to get alerts on all OTCBB and Pink Sheets stock promotions.
