Wednesday, May 16, 2007

Summertime and the Living is Easy

I have the worst case of spring fever ever known to man both physically in all of its manifestations and mentally and spiritually. Consequently it is taking just about every ounce of effort I can muster to post anything - even though I love it so.

That said here is an education in a chart. Listen and learn.

As normal I haven't a clue what this company does or how well they do it - all I see is blips on a screen. Here is what the blips from the past told me - on 3/07 a BOB completed. The blowoff in this instance was so obvious that only a moron could have missed it. Then the traders in this stock kind of swapped shares back and forth for awhile (and yes after the fact we can call that a "base" because it is so obvious) but more important it never went below the low of the second BOB bar. It took about 8 days to break out of the "base" and once that breakout occurred it was full steam ahead for a few weeks.

On 4/24 you got the kiss of death - the "cathedral of dead money" - a gap up away from the EMA 4 that it had been riding and a failure to advance. Sell, Sell, Sell, Sell as my BFF Jimmy Crack Corn Pone would scream. And don't buy back until it breaks 30.60 decisively (that was me - not Jimmy). It didn't. Instead it hit a slide and now look at it. Once more "consolidating" or "basing" or whatever you want to call it (I prefer "not trending" because that is descriptive and actually means something) and there is a good possibility that it is poising for another upward move. Especially since it printed another BOB on 5/14.

I say you could buy it now with a stop just below 25.20 or wait for it to break above 26.10 and take a shot there. Either way it is an impressive chart and might even return a couple of bucks before its next alarming drop.

Of course if it breaks below 25.20 you may want to ignore it and go on to something else.


Woodshedder said...

Possible BOB forming in SWHC.

Anonymous said...

Of course, I sold yesterday, so it can go up now! :)

I sold SWHC in the morning and then looked at the chart after the close and could think of only one thing...that's a bottom.


Summer fun alright.