I remember reading your post 86187 regarding RSI and meant to comment, I'm still just messing around with a free account so I probably wasn't able to that day.
In any case, I just about agree 100% with your older post, and your most recent comment (that I'm replying to)
It is definitely important to sell before the top hits, and RSI 14 can help us as a guide. In your last post you mentioned the pattern of RSI(14) 90+ being at a point where FNMA is ready to dump and I agree, this is a visible pattern that many have not touched on. I recall seeing two others mention it a few weeks back but I cannot recall who I should give credit to there, still, many likely overlooked their posts.
The most important thing I think we need to all remember is that after this run, there will be a DUMP.
The only question is how big of a dump will it be, and, will we be out of it near the top and have cash on hand to grab the recursive aftermath as it repeats the dump for a few days.
I plan to watch the next run very closely and likely will start selling between 7-9 for a bit of profit, also to have cash to rebuy the major dips when it occurs. (I have a margin account But I'm pretty sure most know what I mean. On something like this if your not careful using marginable funds will break your bank.)
Point is, I will have a decent profit and by the time we hit the peak, I will have less than 40% of my position still in need of selling, that way if I time everything wrong, I don't lose my profit.
I will do this by pre-planning strategic exit points based on the initial starting position of the run. After the run has gained a significant amount, as an example; if it starts at $2.00, then 400% would be the longest I would likely wait to start selling.
(putting it at about the $8.00 mark)
Of course, if news turns sour it may be time to sell quick if we already run that hard.
Also considering the RSI(14) and if it is above 90+, then we likely are near or at the peak.
As I've said previously, take everything into consideration. Once the run starts, you better watch it every day and re-evaluate every night. All of the tell-tale signs of a peak will be seen the day before, maybe not at their height... but for example:
1: You notice RSI(14) is at 88...
2: Media is starting to laugh about the entire scenario / bad news is released.
2(B): opposite of mocking the scenario, the media is super pumping it! That's just as bad!
3: The price per share is now at $8.64 and the run started at $2.12 (close enough to 500% at 400% right?)
4: There has been major green bars and price raised $1.50 last few days in a row.
All of those mean: watch me close, be ready to start selling if I look like I'm about to tumble / peak.
Hope you sold some already just in case.
In a scenario such as what I've outlined above, I sincerely hope that anyone who is new to this game, or, who has been lucky up to this point, or, who has their life's savings into this... takes a consideration on instinct and rational thought.
If I saw all of the events briefly outlined above, and I hadn't sold anything yet, I'd be selling half of my float at least at the open just to be safe. No matter where I initiated my trade, I'd have about what I started with in cash by doing so at a minimum.
Good luck to all. While I know someone has to lose, I most certainly hope and pray that it is the institutions which lose rather than those who are here. Just do yourself a favor and if you never have to work again after this, do something worth while for this world, for someone else... not just yourself.
Heh, sorry for the preaching, had to say it though.
EDIT: Goodnight everyone.
-Z
