Q. In short are you looking for a new higher
low confirming the short term uptrend I spoke of in my CLI post which is drawn
between the two big dips late last Sept and early April?
A. Basically yes. I am looking for
a possible bounce off an extention of that line which also corresponds with an
old support at $2.90 (June/July 2000). We saw the test of that area yesterday.
Failing that there are other possible support lines lower down but these are
cross trending with the line you mention.
Q. Are you looking at these new indicators
you speak of as being a good entry for a short term trade or a longer
term entry point?
A. The indicator is actually
a pattern that may be forming. The pattern will initially appear bullish,
but will need confirming as time goes on. It is all dependant on where
the reversal appears, and I will talk more about that as events
unfold.
Q. Am I right in concluding that a longer
term perspective would be to resist until the main red downtrend is broken
through?
A. This would depend on your
trading stance - aggressive or conservative. An aggressive trader will climb
aboard the next up-wave, and perhaps get off again if/when it turns down (as I
predicted before at 3.35). The conservative trader may wait for the top
down-trend line to be broken and then for a higher low to form and the share
then move ahead. It's all down to personal preference - there is no right or
wrong way - whatever you feel happy with. We are talking here more about
trading than investing. The trader has the ability to hold the share for as
long as he likes while the trend is in place, jump off on the signal and can
therefore make huge gains. The investor often sticks with the shares ups and
downs looking far ahead for a profit without any consideration for charting
signals.
All these questions. Great stuff
though!
Cheers
Brian
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