Stock Trading Predictions & Technical Analysis: C - Diamond Top Formation & Engulfing Pattern

Tuesday, September 8, 2009

C - Diamond Top Formation & Engulfing Pattern

"What do you think about C? Today I sold all my shares, which would be a new entry point?"

I think selling all your shares of C today was a great call. There seems to be a diamond top formation, which is one of the hardest formations to observe. One of the criteria of the diamond formation is having C's volume remain strong which is the case. Also the 200 day moving average is flattening out which further fuel that this is indeed a diamond formation. This diamond top indicates a reversal to a downtrend. The shorter the pattern the more quickly C should move down to its price target. Right now I'm observing 3 support levels at $4.00, $3.75, and $3.25. I think it's fair to assume C could pullback around $3.75-$4.00 within 1-3 weeks. The diamond formation is very likely to be confirmed tomorrow, if we have another down gap. Also, an engulfing pattern occurred today. This pattern occurs when after a small gap down, you have a big down gap the next hitting a higher high, but closing at a lower low than the previous day. This is also an indication of a top. In conclusion, I think C will breakdown very soon, possibly tomorrow and start trending back down. In terms of a new entry point, I always like to wait on a day to day basis for the next signal. But a very likely scenario is seeing C pullback down to around $3.75-$4.00, which if it manages to bounce back from these levels and strengthen its support, would be a good entry point.

4 comments:

UnknownSeptember 9, 2009 at 11:34 AM
Good analysis Yoel, thanks.
ReplyDelete
Replies
JoeSeptember 9, 2009 at 1:38 PM
Good technical analysis. Do take a look at C's insider buying lots at $4.85. So imo the price wont fall too much below that. Just my 2cents.
ReplyDelete
Replies
YoelSeptember 9, 2009 at 3:25 PM
I don't think you can conclude that C, would hold up at $4.85 just based on some insider buying, unless it is very significant. I've seen other stocks, with a reasonable amount of insider buying, which didn't stop the stock to move any lower. If the insider buying had any significance, this would automatically be reflected in the stock price, as other investors would follow and raise their bids and their asks.
ReplyDelete
Replies
arkoSeptember 10, 2009 at 5:39 PM
good work yoel.many thanks.
ReplyDelete
Replies

Add comment

Subscribe to: Post Comments (Atom)

DISCLAIMER

The analysis and information given on this site is for information purposes only. Trading in these strategies may result in capital loss. Individuals should do their own independent research or consult an investment advisor before taking investment action. All materials on this site, including the stock picks, are for news and entertainment purposes only and are provided on an "as is" basis and without warranties of any kind, either express or implied.

Under no circumstances will yoel stockpredictions.blogspot.com be liable for any special or consequential damages that result from the use of, or the inability to use, the materials in this site, even if advised of the possibility of such damages including, but not limited to, negligence. In no event shall yoel-stockpredictions.blogspot.com have liability to you for any damages, and losses for accessing this site or using the information provided.Yoel-stockpredictions.blogspot.com does not guarantee that the information contained herein or distributed from this site will be uninterrupted or error-free, that defects will be corrected. Past Results are not necessarily indicative of future performance.

Yoel-stockpredictions.blogspot.com does not trade against you. Some sites are using the size of their visitors to 'move the market' and take advantage personally with their stock picks. This is illegal, and mostly applicable in smaller less liquid securities, which are not covered on this site. It is highly unlikely that the articles in this site about stock picks could ever move the market.

As a visitor to this site, you acknowledge and agree that any reliance on or use by you of any information available on this site shall be entirely at your own risk. In no event shall yoel-stockpredictions.blogspot.com be liable for any direct, indirect, consequential or exemplary damages arising from the use or the performance of this site, even if will yoel-stockpredictions.blogspot.com has advised of the possibility of such damages. Trading may not be suitable for all visitors of this site or the information provided by this service. The visitors assume the entire cost and risk of any trading they choose to undertake.

TECHNICAL INDICATORS

BUY SIGNAL: Indicates the possibility of the start of a new up trend or the continuation of the current up trend. This signal may be often given in the early stages of a potential new up trend that was preceded by a down or sideways trend. Such signals do not always succeed and may fail at time.

BUY: Indicates that the current up trend is already in motion and a BUY SIGNAL was already given earlier. A BUY does not necessarily indicate that the stock will continue higher from here, but simply that the stock is trending up. The further into the trend you decide to take a long position, the more risk you have of seeing it reverse back down sooner rather than later.

STRONG BUY SIGNAL: Indicates a stronger, more significant and reliable signal than a BUY SIGNAL which usually has less chance of failing. Such signals do not always succeed and may fail at time.

STRONG BUY: Indicates that the current up trend is already in motion and that STRONG BUY SIGNAL was already given.

SELL SIGNAL: Indicates the possibility of the start of a new down trend or the continuation of the current down trend. This signal may be often given in the early stages of a potential new down trend that was preceded by an up or sideways trend. Such signals do not always succeed and may fail at time.

SELL: Indicates that the current down trend is already in motion and a SELL SIGNAL was already given earlier. A SELL does not necessarily indicate that the stock will continue lower from here, but simply that the stock is trending down. The further into the trend you decide to sell a position, the more risk you have of seeing it reverse back up.

STRONG SELL SIGNAL: Indicates a stronger, more significant and reliable signal than a SELL SIGNAL which usually has less chance of failing. Such signals do not always succeed and may fail at time.

STRONG SELL: Indicates that the current down trend is already in motion and that STRONG SELL SIGNAL was already given.

HOLD: Indicates that traders who already hold this stock, should hold on as long as the trend persists. This signal is usually given during an up trend for which it would be considered too risky to take a long position at this point.

STRONG HOLD: Indicates that the current trend has been in motion for a while and rarely deviated away from the trend. Although the stock may continue higher, there may not be enough potential up side to trigger a BUY SIGNAL. This type of indicator usually means that the stock has very strong support levels which may have been tested but not broken.

WAIT: Usually given during a sideways trend for which we are waiting for a move that would trigger a BUY SIGNAL or SELL SIGNAL. This could also indicate uncertainty and the risk that would be taken if you were to take a long position at the current level. Taking a long position after giving a WAIT indicator is considered a gamble.