Chart Discussion

[347Mike]

As many of you have read I do not have a lot of experience actually trading, but have been analyzing charts for a year or two now and understand the basics. While I have made poor decisions in the past in penny stocks and hype, I have been fairly "successful" in my trades when I do my own research and analyze the charts.

All of my successful trading has been through chart analysis and trends, I never "marry" a company. I trade by reading the charts and historical data.

With that being said I am hoping I can find a few answers to some questions I have had but have a hard time finding on the internet in my own research.

I understand the difference between support and resistance, and moving averages but not both combined. I would like to know how those two relate, if they have any correlation, and if so, the situations in which they can, and how?

Now this next part is just about Moving Averages and resistance levels. I have noticed on a few different occassions that when a stock is nearing or dips barely below the 200 MA, it will tend to more bullish signs. The same in my experience with resistence levels, when it nears or hits the resistance level, it will start to increase.

I understand there are a lot of fundamentals besides moving averages and support/resistance but let's just use these two as an example for now. What if the 200 MA and resistance levels are far between? What then? Is there a medium or does the stock tend to side with the resistence levels?

Any input is appreciate.

Mike

[Captain Crawfish]

Someone analyze CCJ for me. It got a major ass whooping after the quake but hopefully it will come back. I definately should have jumped in around $28 but didnt have the funds in place.

[Broncojohnny]

Don't depend on me for an answer, as I don't get into all that chart reading shit because it tries to predict what happens over the short term.

Have you searched for "Technical Analysis" on google? That is what this is referred to and I have seen pages and pages of how to read charts on some sites like hotstockmarket.com, they look to be pretty well done.

I'll dig around for some of them later and see if I find anything.

[347Mike]

Don't depend on me for an answer, as I don't get into all that chart reading shit because it tries to predict what happens over the short term.

Have you searched for "Technical Analysis" on google? That is what this is referred to and I have seen pages and pages of how to read charts on some sites like hotstockmarket.com, they look to be pretty well done.

I'll dig around for some of them later and see if I find anything.

I have done hours of research Al and they all explained (from what I have read) what the moving averages do and the resistence levels but not what they do together.

I rely heavily on charts and never news as it plays to much with my gut feeling on my analysis from the chart. Yes anything is predictible but it has proven a success so far.

let me know if you find anything Al, I appreicate it.

[347Mike]

Someone analyze CCJ for me. It got a major ass whooping after the quake but hopefully it will come back. I definately should have jumped in around $28 but didnt have the funds in place.

This may sound cliche, but I don't like offering advice. I will tell you what I am doing but don't like to offer it because that tends to play with peoples judgement and I hate to be the loss of peoples money, esdpecially at my experience level.

How long are you looking to stay with this?
What percentages are you yeilding?

It just suffered a huge drop so chances of it bouncing short term in my opinion are high. I don't like to compare two stocks to each other but this drop/bounce is very similar to CSC so I can see over the next few months it climbing back into the $38 range. The indicators from what I can tell look good (most of them) some look a little uncertain.

I am currently invested in CSC and I predict it hitting $55-$58 range.

[Broncojohnny]

Here is the forum I was talking about. There are some very lengthy discussions about technical analysis in here:

http://www.hotstockmarket.com/forum/list/47

[347Mike]

Here is the forum I was talking about. There are some very lengthy discussions about technical analysis in here:

http://www.hotstockmarket.com/forum/list/47

Thanks, Al. I frequent this forum quite a bit and have spent countless hours reading there. I will have to dig a little deeper though to find my answer (not a normal one apparently).

The reason for asking this is that I am about to pull out of one of my stocks and trade for another but there is one thing I am puzzled on is due to my original question. I have no doubt it will do well over the next 3 months, but I don't want 3 month gains. I make my couple hundred bucks a trade/week and move along.

[slow99]

I understand there are a lot of fundamentals besides moving averages and support/resistance but let's just use these two as an example for now.

Mike

I would just say that you want to be careful using the term "fundamental" when you're discussing technical analysis. Simply because they're two distinct types of analysis. Technical analysis is chart reading, like you're mentioning. Fundamental analysis is what we do: industry analysis, company analysis, financial statement analysis, macro analysis, valuations, etc. I certainly use technical analysis to identify entry and exit points after conducting tons of fundamental analysis. Using the term "fundamental" while discussing technical analysis might confuse some people and make it unclear as to what you're referencing.

[0 GT 2]

While there might be a weak correlation between the two chances are that if you can't Google it and find pertinent information about a topic then it's not necessarily relevant.

There's a lot of factors (that change on a stock by stock basis) that affect the moving average of a stock.

Naturally, if the support is high the stock will grow until it becomes volatile and the resistance grows, then the stock will start to lose value.

I have been at my current position for a few months and I am learning a ton (RE investment banking) and what I've found is that more than bad data, or bad decisions, indecision loses more money than anything.

If you see a stock that looks profitable just pull the trigger. If you feel confident as an investor realize that you have come to that decision based on analyzing data and applying your knowledge of the market to the particular investment.

Look at the maximum you would invest in any one stock (hypothetically) and gauge your confidence in your decision (in a percentage) to decide how much to invest. That will mean your making an investment that you're comfortable with in a stock that you believe in and ideally you will be right.

Investment is spelled R-I-S-K and you have to stick it out there a little bit to reap the rewards.

[347Mike]

I would just say that you want to be careful using the term "fundamental" when you're discussing technical analysis. Simply because they're two distinct types of analysis. Technical analysis is chart reading, like you're mentioning. Fundamental analysis is what we do: industry analysis, company analysis, financial statement analysis, macro analysis, valuations, etc. I certainly use technical analysis to identify entry and exit points after conducting tons of fundamental analysis. Using the term "fundamental" while discussing technical analysis might confuse some people and make it unclear as to what you're referencing.

Thanks for clarifying. I was trying to think of the word indicators but fundamentals came to mine. Thank you though..

[347Mike]

While there might be a weak correlation between the two chances are that if you can't Google it and find pertinent information about a topic then it's not necessarily relevant.

There's a lot of factors (that change on a stock by stock basis) that affect the moving average of a stock.

Naturally, if the support is high the stock will grow until it becomes volatile and the resistance grows, then the stock will start to lose value.

I have been at my current position for a few months and I am learning a ton (RE investment banking) and what I've found is that more than bad data, or bad decisions, indecision loses more money than anything.

If you see a stock that looks profitable just pull the trigger. If you feel confident as an investor realize that you have come to that decision based on analyzing data and applying your knowledge of the market to the particular investment.

Look at the maximum you would invest in any one stock (hypothetically) and gauge your confidence in your decision (in a percentage) to decide how much to invest. That will mean your making an investment that you're comfortable with in a stock that you believe in and ideally you will be right.

Investment is spelled R-I-S-K and you have to stick it out there a little bit to reap the rewards.

Thanks for the input. I don't stick to positions very long. While my way of investing may not be the best method or successful for others it has been for me (so far) and I usually take two approaches in my technique.

1) I want a short and small gain on a weekly basis 2-3%. Once I get that in one week I move along. If I get lucky and hit 5-6% in a week, then so be it.
2) I will follow the same process as above unless I am 80% or more sure that it will yield more percent in my name investment/week.

I have been looking at probably the same 20 companies for the last year and a half and for the most part they will give me my 3-5% in a week if not in a day if I get in at the right time and don't have to immediately cover.

The reason I asked my original question is because (to my knowledge) the 200MA and resistent levels act alike. They keep the stock up and away from dorpping past those levels. But what I am looking for is your guys experience on what you have experienced if the 200MA if a few percent higher than past resistent levels?

I hope that makes sense. I am usually more of a visual person when it comes to explaining.

Mike

[Captain Crawfish]

This may sound cliche, but I don't like offering advice. I will tell you what I am doing but don't like to offer it because that tends to play with peoples judgement and I hate to be the loss of peoples money, esdpecially at my experience level.

How long are you looking to stay with this?
What percentages are you yeilding?

It just suffered a huge drop so chances of it bouncing short term in my opinion are high. I don't like to compare two stocks to each other but this drop/bounce is very similar to CSC so I can see over the next few months it climbing back into the $38 range. The indicators from what I can tell look good (most of them) some look a little uncertain.

I am currently invested in CSC and I predict it hitting $55-$58 range.

Im willing to stay in this for possibly a year but that could change depending on the next few months. If I made 10% I would be happy. My decisions are my decisions i would never blame someone for my losses. Thats all part of the game.

[347Mike]

Im willing to stay in this for possibly a year but that could change depending on the next few months. If I made 10% I would be happy. My decisions are my decisions i would never blame someone for my losses. Thats all part of the game.

The point I am trying to make is just make sure you do your on due diligence. Hype is nothing to fall victim of when it involves your money. That is one reason why I stay away from sites like HSM forum section. Yes, there are knowledgeable people there just like everywhere else but in my opinion a lot just like ot run their mouths and over hype. Goodluck

[slow99]

Im willing to stay in this for possibly a year but that could change depending on the next few months. If I made 10% I would be happy. My decisions are my decisions i would never blame someone for my losses. Thats all part of the game.

I'm not so sure a nuclear power name in the current environment lends itself that well to technical analysis. That thing could meltdown at any second.

[Captain Crawfish]

I'm not so sure a nuclear power name in the current environment lends itself that well to technical analysis. That thing could meltdown at any second.

Thats true a chart means nothing until this japan crisis is under control.