3SOF

Melf Elf - that was a very pleasant surprise 

It seems like the Stock Gury's also decided that today was a good entry level: http://www.forbes.com/investmentnewsletters/2005/09/20/seagate-wynn-invitrogen-cz_mr_0920gurupicks_inl.html?partner=yahootix.

We will soon be a little crowd - I am wondering where KCScott is 

I didn't expect Fed to raise today but STX reaction to the raise hopefully tells about the strength of this reversal.

Quote from: Michael on September 20, 2005, 03:43:36 PM

It seems like the Stock Gury's also decided that today was a good entry level: http://www.forbes.com/investmentnewsletters/2005/09/20/seagate-wynn-invitrogen-cz_mr_0920gurupicks_inl.html?partner=yahootix.

Thanks for the Forbes article, Mike.  I couldn't tell from the wording whether the gurus loaded up at higher prices, or loaded up just recently.  The P/E sure seems low.  Current fiscal year estimate is 2.00, I think, so STX is trading at a P/E of 7.5 basis those earnings.  That seems almost ridiculously low if STX meets the estimate. 

QuoteI didn't expect Fed to raise today but STX reaction to the raise hopefully tells about the strength of this reversal.

We got another Bullish Doji Star Hammer today.  STX printed 5.16, above the day's high of 5.15, right at the rate hike, then backed off, along with everything else.  I consider it a triumph of sorts that STX managed to close in the green.   

I'd like to see a nice upside follow-thru day tomorrow.  A gap up at the open to 5.17...5.18, just  at or slightly above today's high of 5.17 would be nice, then some upside from there.   

Good luck, Mike!

Quote from: Michael on September 20, 2005, 03:43:36 PM


We will soon be a little crowd - I am wondering where KCScott is 

I'm here, still watching from the sidelines (and licking my wounds from IDSA and maybe EYII - Yikes)

From a fundamental perspective this is a great value - I'm in the air to San Fran tomorrow early, so won't have a chance to watch the open. Looks like a lot of shares moved so I may have some time if it makes a break (the way my luck is going lately it will gap up 15%) 

Good luck - I'll try and get a look in when I land in SF

Well, didn't make it to SF, yet - They have this regular occurance called "Fog" that always means flights will be 1-2 hours later than planned. At least they have Wi-fi in Denver.

The whole market is down today on fears of hurricane Rita, and STX is staying put at 15 so I'd view that as bullish. I'm thinking there may be some churning around this level for a while so I'm gonna watch a little longer (and hopefully take some profits in some other positions before I commit)

---------

On a totally unrelated note, I saw a great new security Video product recently called shifrtwatch. The application for transit (trains, buses) etc. has huge potential in both public and private sector. The manufacturer is A4S Security - ticker symbol is SWAT. They just announced a collaboration with Sony today.

Fairly recent IPO - shares are at $5.50 with a total of only 1,200,000 shares. - This issue should fly under the radar for a while - But wanted to give you a "heads up" if your interested.

I took a flyer on 1,000 shares.

Good Luck -

Scott

Quote from: Melf Elf on September 20, 2005, 02:08:03 PM
I just bought it at 15.10. Stop: a close or obvious late day tank below 14.81. Risk: 1.9%.
Thanks for the information.

Sold it at 14.78.   Loss: 2.1%

I don't like the takeout of 14.81 after the two Bullish Doji Star Hammers... that now don't look so bullish.

Hi Melf Elf

That was a short pleasure 

I understand your reasons for selling from a technical point of view. In fact after the last couple of days action I should probably sell 90% of my shares. Let me therefore ask you (and the rest of the TA gurus). Does it make any difference from a technical point of view whether a decline in a stock is due to company specific reasons or a general decline in the market as the one we have suffered the last couple of days.

From a fundamental point of view I believe it makes a big difference. Situations like this offers some excellent opportunities to buy value stocks like AOB, KOMG, CKCM, VPHM, STX etc. etc. etc. at a nice discount.

Mike

Quote from: Michael on September 22, 2005, 04:26:41 PM
Hi Melf Elf

That was a short pleasure 

VERY short pleasure!    I'm glad that STX came back for you yesterday, Mike.

QuoteI understand your reasons for selling from a technical point of view. In fact after the last couple of days action I should probably sell 90% of my shares.

I know what you mean.  I've found the trading environment this summer to be very frustrating, particularly the false breakouts.

QuoteLet me therefore ask you (and the rest of the TA gurus). Does it make any difference from a technical point of view whether a decline in a stock is due to company specific reasons or a general decline in the market as the one we have suffered the last couple of days.

That's a great question, Mike, and it's difficult for me to answer.  For example, I thought that my STX trade had merit, based on the beating that it had taken, the two bullish-looking candlesticks, the good fundamentals, and the risk/reward.

However,  I knew that the KOMG chart looked lousy.  But, the WDC chart looked okay.   

The deciding factor for me in taking the trade was the low risk of 2%.  In other words, technicals and fundamentals aside, at that point, it was a business decision.  As Daniel (Rocket8) said on another thread, (paraphrasing), "Based on what you know, do you want to take the trade or not?"

QuoteFrom a fundamental point of view I believe it makes a big difference. Situations like this offers some excellent opportunities to buy value stocks like AOB, KOMG, CKCM, VPHM, STX etc. etc. etc. at a nice discount.

Hmm-mm...I guess that's where I like to see a marriage between the fundamentals and the technicals.  They seem to be divorced at the moment, in a number of cases. 

As good as the fundamentals have looked on KOMG, CKCM and STX, the charts have looked bearish, which is why I was cautious about trading STX.  A risk of 2% was okay with me, but those stocks have continued to come down.

I'll update the KOMG and CKCM charts in those files, Mike.

   

JMHO - I think the buying kicks in Monday - Rita damage much less than expected (although gas prices will jump in the AM due to loss of several refineries) - My guess would be some some of the growth stocks that have consolidated or flatlined since last Tuesday.

Scott,

On the weekly chart, STX put in a Bullish Hammer at the bottom of the Kumo (Cloud).  If it can close this week at least half way above the prior week's black candlestick, 15.61 or better, that would give us a 3-week pattern called a Bullish Morning Star, which is one of the most bullish bottoming patterns in the candlesticks.

If we get it, STX would have a good chance of rallying to the top of the Kumo (Cloud- vertical green lines) and the broken neckline of the H&S top (thick blue line), which are in the 17.70s-17.80s.

Quote from: Melf Elf on September 26, 2005, 07:37:29 AM
Scott,

On the weekly chart, STX put in a Bullish Hammer at the bottom of the Kumo (Cloud).  If it can close this week at least half way above the prior week's black candlestick, 15.61 or better, that would give us a 3-week pattern called a Bullish Morning Star, which is one of the most bullish bottoming patterns in the candlesticks.

Scott,

It's the end of the week, and STX just printed 15.61.  We'll see how it closes.

Hold all betting tickets 

Yesterday, Needham cut its target on STX from $28 to $21.  Today, JP Morgan downgraded STX and MXO.

Back when STX broke below the H&S top in August, we discussed how "the news is always best at the top," and how the market is a discounting mechanism.  If support breaks, often you find out why later on.

When the H&S top broke, Piper Jaffray lower their target from $27 - $25.  They still liked the stock, though.  $25 wouldn't be bad!  Yesterday, Needham lowered their price target from $28 to $21, but they still like the stock, too.

Today, JPMorgan downgraded STX.  But, they still like the stock, too!   

STX is trading at 14.85, flirting with its recent low.  If STX is worth anywhere near the  $21.00, shouldn't JP Morgan be upgrading STX?   

This is why I like to watch the charts.  Some of these guys wouldn't say SELL IT if they had a mouthful.  Instead, they keep ratcheting their targets down....down...down.

I will say, though, that when STX broke the H&S top, this lowering of expectations and targets is what I expected.  The old stock market saw: "First the chart...then the news," meaning first the chart breaks down, then later on (like now) you find out that targets are getting lowered, expectations are reduced, etc.

We'll watch for STX to stabliize.  If it's going even to the reduced $21 target that Needham has on it, that wouldn't be a bad gain from here.  Over 40%.

6:03am 10/13/05 

Seagate Tech cut at J.P Morgan on industry view (STX) By Aude Lagorce

LONDON (MarketWatch) -- J.P. Morgan cut hard disk drive maker Seagate Technology Corp (STX) to neutral from overweight, citing its more somber stance on the industry economics for the next few quarters. Still, the broker told clients it continues to believe Seagate is the best positioned disk drive maker, particularly given its lead in next-generation technology investments, vertical integration and broad product set.

Hi Melf Elf

You are right once again! You most make a killing in this market 

Today is a interesting day in the HDD market. KOMG who is a supplier to the HDD producers is upgrading due to strong demand freom their customers and the stock increases 3.5%. Seagate who is one of the customers falls 3.5% because J.P. Morgan is concerned that growth will lag historical demand in the December quarter.

So the company supplying the HDD producers are upgrading because of strong demand and the analysts is downgrading the HDD producers.

Well I am probably an idiot but i actually believe the company supplying Seagate more than the JPM analyst.

But as you would say the chart tells the truth and you are almost right. The chart reflects what the analysts tells their customers and how the customers reacts to the recommendations but is that the truth?

I don't think so but as said if you by reading the chart can get insight to the analysts upcoming recommendations you might make a nice profit but if you can forecast the acutal earnings of the company you might do even better 

Mike,

The timing of these downgrades in STX sure is interesting.   

Chartwise, I don't see that we have anything nearly as convincing as when I rated the August 29 Piper Jafray upgrade as  a STRONG SELL, which I think was my first post in this folder. 

That upgrade came the day after we completed the big H&S top, and I viewed it as a thinly veiled attempt on Piper Jaffray's part to manipulate the stock higher so that they could dump it.

But, I'll tell you what we do have in STX at these two analyst downgrades: a double bottom  at 14.49 and 14.50, right at the level where STX broke out of an Inverse H&S pattern last November.  The neckline was 14.59 - 14.50. 

"Former resistance should serve as support," and as the chart stands tonight, we've got a successful  double re-test the 14.50 support area, and we have two analysts DOWNGRADING the stock.

Hmmm-mm...

We're also at a juncture in the market where it's tough to find many who like it, including myself 

Hmmm-mm...

I really, really don't want to buy this stock tomorrow, Mike, even if it did just have TWO successful tests of 14.50 support.

Hmmm-mm...

I HATE THE MARKET RIGHT NOW!!        

Hmmm-mm....



 

Quote from: Melf Elf on September 30, 2005, 09:50:48 AM
[Scott,

On the weekly chart, STX put in a Bullish Hammer at the bottom of the Kumo (Cloud).  If it can close this week at least half way above the prior week's black candlestick, 15.61 or better, that would give us a 3-week pattern called a Bullish Morning Star, which is one of the most bullish bottoming patterns in the candlesticks.

STX did end up putting in the 3-week Bullish Morning Star pattern that week.  The close was 15.85.

STX didn't make much upside progress from there, though.  It got stopped at first resistance, the Tenkan-Sen (Green line), on the Ichimoku Kinko Hyo chart.  The rally high was 16.51.

Interestingly, if STX has put in a double bottom at 14.49-14.50 and can take out that 16.51 high, the target, for the "W"-bottom breakout measures to TRIPLE resistance:

1. The broken neckline of the H&S top (Blue line)
2. The Kijun-Sen (Red line)
3. The Top of the Kumo, or Cloud (vertical lines)

Math:

16.51 high - 14.50 low (I use the more conservative number) = 2.01 points

2.01 points added to a breakout above 16.51 = Target: 18.52

The top of the Kumo (Cloud) currently is 18.40. 
NOTE: In counter-trend rallies, its common to fall short of targets.

Given how bearish the market has looked lately, I'm wanting to consider bullish possiblites.   

Quote from: Melf Elf on October 14, 2005, 02:50:57 AM
We're also at a juncture in the market where it's tough to find many who like it, including myself 

Hmmm-mm...

I really, really don't want to buy this stock tomorrow, Mike, even if it did just have TWO successful tests of 14.50 support.

Hmmm-mm...

I HATE THE MARKET RIGHT NOW!!        

Hmmm-mm....

I was tempted to buy the 14.49-14.50 double bottom, and it would have worked out okay for a quick trade on the relief rally, but this chart, and the market in general, has looked so lousy, I passed on the trade.

STX rallied only for two days, never got near next resistance at the trendline, then came right back down and broke the double bottom on Wednesday, and closed below the double bottom yesterday.  Ugh.

Still acting bearish.