What do you think about these two stocks? I'd love to here your opinion and see if it compares to mine. JP
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Give me a stock, any stock...
- Thread starter michaelscott
- Start date
What do you think about these two stocks? XMSR and MOT, I'd love to here your opinion and see if it compares to mine. JP
FCX-
These mining stocks honestly confuse me. When I first looked at FCX in another thread, I honestly thought the Elliott wave took over this monster and used some Fibonacci calculations. . I said that it would turn back to 52 shortly, but I have now revised that thinking.
Sitting down and looking at it a little more I have developed a rough thesis. A very rough thesis that should not be relied upon to trade, but for informational purposes only.
There is a reverse head and shoulders on the chart and the neckline is debatable.
59.58-40.75= 18.83
18.83+59.58= 78.41 target price
There appears to be a bearish wedge and a mania at the end of the chart. The volume at the end of the chart is the greatest its been, ever. There has been no higher volume for the trading of this equity.
The RSI, OBV and ADX are through the roof. The price has escaped through the upper resistance of the wedge and is now challenging the 67.5 resistance level.
I have marked places on the chart where the RSI topped and it appears these were all notable tops telling us that the equity was soon to make a dramatic fall later on. Look at previous falls, large gaps and waterfall selloffs. Not much time to call off the trade.
I see it made it over the top bar, but I would want to study the intraday chart to see if this is legit.
Bottomline is that if it can stay over the resistance and we keep getting more volume it will make it over 70. The stock is in a bearish wedge mania meaning it can go much higher, but when it turns there might be a waterfall selloff. I count roughly 6 small and large waterfall selloffs on this chart in the past. The reverse head/shoulders suggest 70s is the target price. The RSI is telling me "overbought", but the other indicators say this move up is strong and has legs.
The target price is very rough because stocks in manias where people are blindly buying can tend to shoot way past the target, but can also turn around just as quick.
Trading this is risky and I say there are easier stocks to trade that are less risky. However, if I was going to trade it then I would wait for it to fall. My belief is that there maybe 10-20% more upside here, but what if it turns on you and falls 15 bucks in a day? The sweet gain is easily wiped out by a panic cascade of sellers. Indeed, I looked back through the news and I see a bunch of analyst upgrades, Cramer pumps, etc. Some of the price in this stock is mania.
Luckily FCX works great with Fibonacci retracements as I illustrated during the last downturn on the chart. You could have made an easy safe 20% with the retracements in June 2006 by simply being patient.
Now if I were to risk a long position, I want to see this get over 70 and close there on above average volume. Otherwise, I am unconvinced that it will stay up there for long.
These mining stocks honestly confuse me. When I first looked at FCX in another thread, I honestly thought the Elliott wave took over this monster and used some Fibonacci calculations. . I said that it would turn back to 52 shortly, but I have now revised that thinking.
Sitting down and looking at it a little more I have developed a rough thesis. A very rough thesis that should not be relied upon to trade, but for informational purposes only.
There is a reverse head and shoulders on the chart and the neckline is debatable.
59.58-40.75= 18.83
18.83+59.58= 78.41 target price
There appears to be a bearish wedge and a mania at the end of the chart. The volume at the end of the chart is the greatest its been, ever. There has been no higher volume for the trading of this equity.
The RSI, OBV and ADX are through the roof. The price has escaped through the upper resistance of the wedge and is now challenging the 67.5 resistance level.
I have marked places on the chart where the RSI topped and it appears these were all notable tops telling us that the equity was soon to make a dramatic fall later on. Look at previous falls, large gaps and waterfall selloffs. Not much time to call off the trade.
I see it made it over the top bar, but I would want to study the intraday chart to see if this is legit.
Bottomline is that if it can stay over the resistance and we keep getting more volume it will make it over 70. The stock is in a bearish wedge mania meaning it can go much higher, but when it turns there might be a waterfall selloff. I count roughly 6 small and large waterfall selloffs on this chart in the past. The reverse head/shoulders suggest 70s is the target price. The RSI is telling me "overbought", but the other indicators say this move up is strong and has legs.
The target price is very rough because stocks in manias where people are blindly buying can tend to shoot way past the target, but can also turn around just as quick.
Trading this is risky and I say there are easier stocks to trade that are less risky. However, if I was going to trade it then I would wait for it to fall. My belief is that there maybe 10-20% more upside here, but what if it turns on you and falls 15 bucks in a day? The sweet gain is easily wiped out by a panic cascade of sellers. Indeed, I looked back through the news and I see a bunch of analyst upgrades, Cramer pumps, etc. Some of the price in this stock is mania.
Luckily FCX works great with Fibonacci retracements as I illustrated during the last downturn on the chart. You could have made an easy safe 20% with the retracements in June 2006 by simply being patient.
Now if I were to risk a long position, I want to see this get over 70 and close there on above average volume. Otherwise, I am unconvinced that it will stay up there for long.
Attachments
XMSR
This is a classic rule I have for longing stocks involved in a selloff. I use it for intraday trading and not usually on the monthly chart.
However, you can see plainly that there was a double bottom and an uptick in OBV. A strong sign to long it and it retraced perfectly with the Fibonacci lines.
Now it did a 50% retracement and the price appears stuck in the gap that was created in November. Also notice an overhead gap where it appears that is the new resistance. The price bounced off nicely.
There are two things that can happen from here. The price needs to escape out of the gap pocket where it rests. You'll have to go back to the exact time and sales on the day of the gaps to get exact pricing. I want to see the stock close over the gap to long it, but I would carefully watch it to see if it will go through the other gap. This resistance is going to be tough.
The other thing I believe that can happen is for a triple bottom to occur which will be bullish and require patience. I would wait for it to bounce off that bottom with a passion before longing it if thats a possibility. You can short it if it makes it below the gap for a quick 1.50-2 in the price then cover before 10.
The RSI and ULT are telling me that a bottom has been made, but these indicators can appear oversold for a while before a blip up.
The gaps are key to this scenario and I would figure out the exact prices and construct a long/short plan depending upon if it made it over.
I almost forgot. If you zoom in on the chart, you can see a rough head/shoulders and the neckline has just been broken. The target price roughly around 9.
Bottomline. I see a triple bottom as the most likely scenario, but the price might pivot at the gaps. I think its too risky to trade it up through these gaps, but I would definately long it if it made a triple bottom (and respected the support).
This is a classic rule I have for longing stocks involved in a selloff. I use it for intraday trading and not usually on the monthly chart.
However, you can see plainly that there was a double bottom and an uptick in OBV. A strong sign to long it and it retraced perfectly with the Fibonacci lines.
Now it did a 50% retracement and the price appears stuck in the gap that was created in November. Also notice an overhead gap where it appears that is the new resistance. The price bounced off nicely.
There are two things that can happen from here. The price needs to escape out of the gap pocket where it rests. You'll have to go back to the exact time and sales on the day of the gaps to get exact pricing. I want to see the stock close over the gap to long it, but I would carefully watch it to see if it will go through the other gap. This resistance is going to be tough.
The other thing I believe that can happen is for a triple bottom to occur which will be bullish and require patience. I would wait for it to bounce off that bottom with a passion before longing it if thats a possibility. You can short it if it makes it below the gap for a quick 1.50-2 in the price then cover before 10.
The RSI and ULT are telling me that a bottom has been made, but these indicators can appear oversold for a while before a blip up.
The gaps are key to this scenario and I would figure out the exact prices and construct a long/short plan depending upon if it made it over.
I almost forgot. If you zoom in on the chart, you can see a rough head/shoulders and the neckline has just been broken. The target price roughly around 9.
Bottomline. I see a triple bottom as the most likely scenario, but the price might pivot at the gaps. I think its too risky to trade it up through these gaps, but I would definately long it if it made a triple bottom (and respected the support).
Attachments
Another thing to notice with XMSR is that the MACD histogram dips are becoming shallower and shallower with each passing bottom in price. This is almost a sure sign of a strong reversal and we may not even see another drop in price, it could ride on up from here.
OIH-
So for OIH we are seeing either a classic triple top (and we are on the third top) or we are seeing a reverse head/shoulders pattern.
In order for the reverse h/s to complete, it must break (close) above the neckline. Therefore, I would only enter into a long position after its able to close above the neckline with volume. Normally, we would see the break in the neckline followed by increased volume levels. Im not seeing increased volume on the chart. So there are 3 possible scenarios.
1) A break above the neckline right now. (Not likely)
2) A brief pullback and dance above the neckline lasting days to weeks and then followed by a neckline break (most likely)
3) A failure to complete and then a pullback to the 125 level with a possible breakage of support and then additional downside.
I would go long over 156 on an *expansion in volume*. This is the safest method. The reason why I chose 156 is because there is an overhead gap in trading between May-June 2006. That will act as resistance. You could go long sooner, say 152-153 but that would involve more risk as that gap might provide resistance.
The upside here on a pattern like this is 33 points above the neckline or a target price of 183.
The downside is a failure to complete followed by a rapid pullback to 125. If there is a break in support, then we could be looking at a price target of 84.
Personally, I would wait to see how it plays out. The key is the breaking of the neckline.
You can safely short it if the price gets below the 50 day moving average.
Another key factor is the 20/50 day moving average crosses. In past history, these crosses usually last for 3-6 months signaling a change in trend for the OIH. It appears the 20/50 just recently crossed over and if history is to be used as a guide, there will be more upside to come for at least 2 months. This is a sign that the breaking of the neckline might just play out.
So for OIH we are seeing either a classic triple top (and we are on the third top) or we are seeing a reverse head/shoulders pattern.
In order for the reverse h/s to complete, it must break (close) above the neckline. Therefore, I would only enter into a long position after its able to close above the neckline with volume. Normally, we would see the break in the neckline followed by increased volume levels. Im not seeing increased volume on the chart. So there are 3 possible scenarios.
1) A break above the neckline right now. (Not likely)
2) A brief pullback and dance above the neckline lasting days to weeks and then followed by a neckline break (most likely)
3) A failure to complete and then a pullback to the 125 level with a possible breakage of support and then additional downside.
I would go long over 156 on an *expansion in volume*. This is the safest method. The reason why I chose 156 is because there is an overhead gap in trading between May-June 2006. That will act as resistance. You could go long sooner, say 152-153 but that would involve more risk as that gap might provide resistance.
The upside here on a pattern like this is 33 points above the neckline or a target price of 183.
The downside is a failure to complete followed by a rapid pullback to 125. If there is a break in support, then we could be looking at a price target of 84.
Personally, I would wait to see how it plays out. The key is the breaking of the neckline.
You can safely short it if the price gets below the 50 day moving average.
Another key factor is the 20/50 day moving average crosses. In past history, these crosses usually last for 3-6 months signaling a change in trend for the OIH. It appears the 20/50 just recently crossed over and if history is to be used as a guide, there will be more upside to come for at least 2 months. This is a sign that the breaking of the neckline might just play out.
Hey how about TGT