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I posted on 4/29, “Beautiful Cup & Handle”
recommending OCX. It rose briefly, pulled back and has subsequently been stopped twice at resistance in the 3+ area. The chart is still very bullish and especially so, since it is exibiting one of the most bullish features possible. When a long, beautiful cup and handle develops a smaller cup and handle within the confines of the original handle, that is as bullish as it gets. Don’t know when, or what the catalyst will be but I expect a roman candle before the 4th of July! Buy.
May I ask whether you have a professional background in this sort of stuff? Biotechy stuff as I infer this is? Just curious.
I have never decided for myself whether having professional background in an area is a significant aid in stockpicking — other than for insider trading — I am most definitely assuming you are not involved in that!!! Sometimes I think that experts get too caught up in the details of their trade etc.
50 plus years studying charts and financial markets. No medical or biotech work history. Started out as Chemistry major and switched to finance because foreign languages only subject not good in at school. Forget anything else but charts. I could see where you’d think because most of these have been biomed just where I am finding good charts. Also had AVID, ERJ and rock VLMGF.
I also like the chart. I have too little play money however. Anything biotech-y terrifies me however. I used to know a rather large amount about that sort of thing (in fact still do a bit) and feel intimidated by how rapidly the knowledge changes. I was also impressed that people I worked with (at least so was my casual sense) did not seem to do particularly well investing unless they were insiders–started companies etc.
Interesting that you do so well relying largely on charts.
Just remember, all the info that everyone(including insiders) knows or think they know is reflected in “the chart”! Keep it simple, don’t get hung up on news, info etc. A picture (the chart) is worth a thousand words (info, news, opinion) Good luck Karl.
However a problem with charts (in my opinion at least) is that although they tend to be a result of much or all the information, it is information much like a projected image, a shadow on the wall, where it is difficult for me at least to know what summed up to cause it, much less the distortions and angles of perspective.
I’ll take an example from the dumb-as-rocks world of penny explorecos, which is way too complicated for me to understand as it is. I will see my most reliable signs indicating that the stock price is going down, that things aren’t good. There are various ways in which things might not be good (bad company, good company with a little bad news coming, good company within a type of company out of favor). These things are possibly susceptible of being teased out, but only (at least by me) somewhat well at best. What is the real problem when is when it is really obvious that there is something company-specific. Then I simply do not know. Are insiders selling because they know something bad I don’t know? Do insiders or hangers-on know some really great news — great drill results, imminent takeover… — and are driving the price down to mimic a company in distress in order to buy shares at a cheap price? Or (and I honestly believe this scenario happens more often than cynics believe) are there sometimes many honest insiders or near-insiders who know of good news that hasn’t been let out to the public — often a discussed takeover — and they are just being clean about it and have stopped trading and are going around looking grim as if the world is about to end, poker face as if they have been told they have about 2 days to live sort of thing, so as not to give anything away. I can’t tell these alternatives (bad news, manipulation down so as to buy impending good news, withdrawing selling and acting as if glum to keep impending good news quiet) apart from the charts.
This is an example where at least with my eyes and brains the charts may result from everyone’s knowledge but I can’t interpret them any better than I can necessarily interpret what makes shadows.
Karl, You are making it way too complicated. I don’t know if you are more a very short term trader, or fairly long term investor? I am intermediate to long term. I don’t care about anything but the chart, and the company’s market cap. If you are a short term trader I can’t help you. If not FORGET about info, news insiders etc. The charts show you where is a good time to enter. When you feel a stock has exceeded it’s valuation you start looking to take profits. A good example is MRNA. I read about it in Barron’s in early Sept. Liked the chart and valuation at the time. Didn’t have any idea about Covid or that they would be involved with it. It exceeded my expectations but got totally overvalued and is now a busted company. I would only trade it if I was a trader but it is dead and buried as far as an investment.
I was merely illustrating a counter example on how charts can’t tell it all even though they may be the resultant of much or all information, like shadows.
I have been a long term speculator. My favorite thing over the years has been staring at charts — I often like looking at charts with no added lines like yours — of penny metals companies, looking for long term signs of accumulation, looking for ones that are edging up ever so slightly more than their peers over weeks, months, even years, holding forever.
For fun however I am trying to learn shorter term stuff, especially to help timing selling, and trying to learn how to handle the big mining companies, which are held by really flighty investors and consequently hard for me to time. I am trying for inspiration a service I will not name here that I like in that the author doesn’t have many lines on the charts or words — often just the charts and 1-2 moving averages and a comment or two on what he did or is doing or thinking of doing and why +/- a horizontal line or two. He sometimes goes against trends. I don’t. I’m trying to figure out the psychology of the shorter term and of going against trend but don’t do it myself. But I like simple charts in any case having stared at so many charts for so long. Thanks for asking.