John Lansing's Trending123
John Lansing's Trending123
Username: Password: Login
Trade Talk E-Letter Products & Services Trading Tools Portfolios Members Home
risk-free trial

stock market trading chart pattern research
Monday, February 27, 2006

February, Tuesday 27 2007

Pre - Market Update - 3 New Possible Swing Trades - Wait for trigger / Buy Alerts - Technical Analysis Charts for DAKT, GROW, & NCX


Good Morning. Futures are down sharply this morning. This will give us the buying opportunity that we have been waiting for to add some new buys. I have been waiting for a pullback, because obviously you don't want to keep buying rallies. Buy low sell high. Let us use this volatile open to buy these stocks. This will give us entries with good risk reward ratios.

Please click on the trading journal link provided for you below, in order to print out your trading journal sheet if you need a new one. This is the first step that you need to follow on your path to achieving "sudden profits." This is what is called doing your technical analysis homework on an equity before you enter a trade. Remember that a good trader is disciplined and always plans their trades , and so should you. A failure to plan is a plan for failure! Using this journal is a great way to learn how to trade with a trading journal! This way, you can update your trading journal as you read and listen to the updates on these stocks. Jotting down notes will help you learn what is important to look at in the technical analysis of each chart. You can also refer back to your notes to see why you entered the trade, the issues you had will holding the stock as you waited for it to reach price target, and why you exited the stock, and whether you made a profit or a loss. This enables you to identify your trading strengths and weaknesses. The time spent doing this, will help you eliminate your weaknesses in order to become a good trader. Old habits die hard. On the other hand, Knowledge is Power. We want to encourage you to get rid of those weakness so that you can become an even more profitable trader.

Please Note: This is not a requirement that you do this. There won't be a test or anything like that. (lol) It is just a suggestion, we do believe that this is a helpful tool for our subscribers to use. We provide it for you for your convenience. The decision is left up to you.


The original Trading journal sheet: http://trending123.com/short-term-trades/trading_journal.htm

Classic Patterns - Classic is a term used to refer to a group of patterns that typically have a longer-term horizon (greater than 12 days) and which have distinct price swings such that the price swings form distinctive patterns. The names of classic patterns often reflect the shape of the formation such as the Double Top, Double Bottom, Head and Shoulders Top, Ascending Triangle and so on.

Classic Bullish Megaphone Bottom Pattern This classic Bullish continuation type pattern is illustrated in the DAKT chart discussed below. The classic Bullish Megaphone Bottom Pattern. - "A Megaphone Bottom also known as a Broadening Bottom. It is considered a bullish signal, indicating that the current downtrend may reverse to form a new uptrend. This rare formation can be recognized by the successively higher highs and lower lows, which form after a completed downward move. Usually, two higher highs between three lower lows form the geometric shape of a Reverse Symmetrical Triangle.. The pattern is completed when prices break above the second higher high and do not fall below it." Please note that this pattern is a much more difficult pattern to trade than a rectangle for example. I do not recommend this pattern for new subscribers or novice traders.

Daktronics Inc. (DAKT) - Daily Charts - Classic Bullish Megaphone Bottom Pattern/ Reverse Symmetrical Triangle (RST )- Electronics - Buy Alert The daily chart of DAKT illustrates that it has been trading in a broadening type of bottom pattern/ RST. This is a very difficult type of pattern to play. This is because the stock is making higher highs and lower lows in a bullish pattern that is difficult to grasp. This is just the nature of the this pattern. DAKT has a lot of gaps, but the good news is that it is able to use those gaps as support. I want to enter DAKT around the $27.00 / 26.00 area, which is also the gap support area. If we can pick up DAKT around those levels, then expect a bounce up to the 34 EMA ( which acts as a magnet for price to move up to), and then higher up to the top of the triangle marked by wave E.

US Global Investors Inc. - (GROW) - Daily Chart - Bullish Continuation Wedge - Asset Management - Buy Alert The daily chart of GROW illustrates that it is in a Bullish Continuation Falling Wedge pattern . This pattern forms in an uptrend, therefore it is classified as a continuation pattern. The wedge represents a pause before it continues on its uptrend. As you can see, GROW has completed an impulse wave 3 to 4 pullback. GROW is still trading within the wedge. GROW is an extremely volatile stock. I want to buy this stock on a back down and that is exactly what is happening. I want to buy it around $40.00 around the uptrend line, which would be at support because it is above impulse wave 1, which can never overlap. Buying around here increases our risk reward ratio. The Aroon indicator is still in a bearish trend, so this is a good buying point. The PPO and Stochastics are showing bullish divergence, hinting a bottom and a continuation of the prior bullish trend. .

Nova Chemicals Corp. - (NCX) Daily Chart - Falling / Continuation Wedge Reversal Breakout Pattern - Chemicals Sector - Optionable Now let's zoom in even further and look at the Daily chart. This is the 3rd step in your technical analysis. Again, as stated in the weekly chart, as you zoom in closer in time, you get even more detailed analysis. (This conversely, brings you further away from the big picture of the monthly, which you always want to keep in mind, while waiting for long term swing or investment trades to reach price target.) You want to look at the daily chart in order to see if the chart confirms or conflicts with the analysis deducted from the monthly and weekly charts. Looking at the daily chart of NCX ,you can see that the continuation falling wedge breakout pattern appears again, and the impulse wave 3 to wave 4 count remain the same as well as the lettered waves. This repetition confirms what you have deduced from the previous charts. Within the wedge you can see that a triple bottom has occurred which you do not see on the weekly chart. This confirms that the lows are in, and that NCX is in the process of bottoming and ending wave 4. As on the weekly, you can see even more bullish divergence presenting itself in the RSI and PPO. You also see a bullish triple exponential moving average crossover, which you do not see on the monthly or weekly charts. In addition, you can see how strong the volume came into the stock as each low was placed while it formed a triple bottom. Furthermore you can see that strong volume came in upon cross of the EMA's and built up steadily as it broke out of the wedge. Then you look at the indicators and oscillators and you can see that they are all confirming the breakout of the wedge. The Aroon is in a bullish cross, the RSI and PPO shows strong bullish divergence after each low is placed and confirm with the pattern of the falling wedge.

Edited by :Andrea Victoria Friend aka Daisy
Editorial Assistant for Trending123.com

 



 

Today I will have 3 new buy alerts If you have not seen my update on NCX it might be a good time to review (All the things I look at.) If you have seen it, then it could be a little reminder of all the things I look at as a possible refresher course. With the exception of one of the stocks, these are EXTREMELY high beta "fast moving stocks" and they are longer term swing trades

(Target is expected 3-6 months so they border swing/investment trades).

I will have a full pre-market update on them but for those that are new; these are all the things that go into play when picking out a stock.

In the portfolio they will be highlighted in BLUE in the morning until the actual trigger is hit (That’s when the price actual turns in our favor and momentum turns to the upside) then an email alert will be
issued changing the stocks color in the portfolio from blue to yellow and then at the end of the day back to grey as a open position.

Remember the rules, no more than 5% per position. With the exception of one of the stocks they are very high beta (they can move 10% in a single intraday move) and will be called high risk.

One pattern looks like OMG and another pattern is looks BAP (you might review the BAP and OMG past archived updates to see how we played those).

Here is the NCX update (BTW NCX yes is one of the stocks that we hope to buy).

The others are DATK (RST pattern)

Also GROW (Falling Wedge Continuation Pattern) with bullish divergence now see in the MACD and PPO with price.

I’ve gone through all the upside potential and downside risk and right now these seem like some volatile plays that could pay off nicely if we play them according to the rules.

NCX Update

 

Short Interest--Daktronics, Inc. engages in the design, manufacture, and sale of various display systems for sport, business, and transportation applications. Its products include small indoor and outdoor scoreboards, computer-programmable displays, large screen video displays, control systems, and timing and sound systems. The company also offers various proprietary display control software to complement the display technologies. In addition, Daktronics develops content for the displays, including animations and advertising content. The company sells its products in the United States and in various other countries through a combination of direct sales personnel and independent resellers. Daktronics was founded by Aelred Kurtenbach and Duane Sander in 1968. The company is based in Brookings, South Dakota.
Stock Charts
Short Interest--U.S. Global Investors, Inc. through its wholly owned subsidiaries, provides mutual fund management services. It provides investment advisory services to institutions and individuals; transfer agency and record keeping services; mailing services; and distribution services to mutual funds advised by the company. The company primarily invests in early-stage or start-up businesses. U.S. Global Investors was founded in 1968 and is headquartered in San Antonio, Texas.
Stock Charts
Short Interest--NOVA Chemicals Corporation produces commodity plastics and chemicals worldwide. It operates in two segments, Olefins/Polyolefins and Styrenics. The Olefins/Polyolefins segment produces ethylene, which is used in the manufacture of polyethylene, styrene, polystyrene, and polyvinyl chloride; and polyethylene, which include high-density polyethylene, low-density polyethylene, and linear low-density polyethylene. It also offers energy co-products, such as benzene, propylene, crude C4 hydrocarbons, C5 dienes, dicyclopentadiene, aromatics, C9 resin oils, and hydrogen; and chemical co-products, including diesel fuel, gasoline components, home heating oils, and industrial fuels. The Styrenics segment produces styrene monomer and styrenic polymer resins. NOVA Chemicals serves customers that produce consumer, industrial, and packaging products. The company markets its products through its sales force; and distributors, agents, and traders. NOVA Chemicals was founded in 1954 and is based in Calgary, Canada.
Stock Charts
MONTHLY--NCX PATTERN   DAILY--GROW PATTERN
Stock Charts
DAILY--DAKT PATTERB
Stock Charts
Stock Charts
Stock Charts
Stock Charts
Stock Charts

Stock Charts
Stock Charts