3SOF

Hi Terlisa,

I remember that I long time ago said that sooner or later you and I would find a stock we both liked. It is kind of ironic that the stock would be one that I sold way too early and you just have covered and that none of us own!

David bought a heavily discounted ticket for this party. We might have to pay a bit more but judging from his messages it might be worth it 

Mike

Quote from: Michael on February 08, 2006, 04:17:07 PM
Hi Terlisa,

I remember that I long time ago said that sooner or later you and I would find a stock we both liked. It is kind of ironic that the stock would be one that I sold way too early and you just have covered and that none of us own!

David bought a heavily discounted ticket for this party. We might have to pay a bit more but judging from his messages it might be worth it 

Mike

You got good memory there Michael, I think that was in STX thread

Well for GIGM is in bearish mode at this point.  if we really want to go LONG in GIGM we want to trigger our trade the best entry time, right Michael? And that's what i want to target.
I believe GIGM will trade in range for a while before going where it supposed to be going.. maybe few weeks, few months.. I don't know, time will tell
(Just like what happening now in AOB & VPHM)

We all heard the saying, "THE TREND IS YOUR FRIEND" if you will try to trade against it, you are a dead man...

Goodluck,

Quote from: David Randolph on February 08, 2006, 08:32:59 AM

I hope this doesn't happen to you Terlisa, I'm sure it won't. But always keep an open mind to new ideas 

Thanks Dave, just like you said & every book that i read... Money Management is a #1 Rule.
& don't confused with my screen name, I am a "He" ***Terlisa <-----> Alister***

Quote from: netfishmademerich on February 08, 2006, 12:55:41 PM
Do we not have GIGM in 2 portfolios?  one of them being the "trading portfolio"?  I am all for keeping GIGM in the long term portfolio but I fail to see why we are keeping it in the short term portfolio.

Hello netfishmademerich  Let me try to explain.

The goal of a long term investor is to buy a valuable stock, with strong growth prospects, so the share price rises on a long term basis. The goal of a trader is to beat investor's performance by trying to sell high and buy low.

I missed the opportunity to sell GIGM high for the Stocks on Fire Portfolio, say, at $5.5. Perhaps I was distracted. But, will I beat the Long Term on Fire portfolio performance if I sell now, at a low point? I don't think so. I want to sell GIGM in overbought conditions to buy back in oversold conditions, not to sell oversold and buy overbought, right?

I trust in my long term analysis that says GIGM will rise again and make new highs above $5.5. That's where I plan to sell GIGM.

I've added some momentum indicators to my chart below so we can check GIGM's oversold condition. I have time to wait for GIGM to make a new high, the medium and long term trends are still bullish, despite the short term bearish trend.

Just have to say with emphasis, GREAT THREAD!!!!. WOW!!!! LOVE IT!!!!!

uc.

David,

Applause for this nice pick, and thanks for your explanation about your medium-to-long-term view on GIGM.  I have a trader's mentality, so I would have had to fold on the neckline break 4.35..

I wasn't going to comment any further, since comments on the short-term are inappropriate in this folder, given your longer-term perspective, but I decided to "throw it out there" and post this, since it "could have' at least medium-term implications.

Yesterday, the broken neckline of the H&S top was at 4.337. (it slopes down slightly).  GIGM closed just about smack on it, at 4.35., which was the print number where the neckline broke. 

Yesterday's print high was 4.58.  On the Ichimoku Kinko Hyo chart, the 4.58 high was just below a Bearish Cross of the Tenkan-Sen/Kijun-Sen, at 4.635-4.64, which occurred yesterday (I'll explain that in the next post). 

Additionally, we've got a "possible" double neckline at 3.90.  If that should break, we'll have 2.17 IN PLAY.

Math:

High of the Head was 5.63
Double Neckline is at 3.90

5.63 - 3.90 = 1.73 points

3.90 (if it breaks) - 1.73 points = Target 2.17 IN PLAY

With the fundamentals looking so good, 2.17 doesn't seem likely at this point, but interestingly,  November 17 earnings left a gap on the chart at 2.18, so if it goes IN PLAY, I wouldn't rule out that possibility.  It isn't uncommon for gaps to get filled.

The Tenkan-Sen (bold green) and Kijun-Sen (bold red) act somewhat like a price-related MACD.  The former is an 8-day; the latter a 22-day.

When they are properly positioned (green above red), and when price is above them, "all is well," as we can see on the chart.  GIGM rallied off November earnings.

Yesterday, February 9, we got a Bearish Cross (green below red).  Like any other indicator, there aren't any hard and fast rules.  We have to interpret the signal, based on what price is doing, and based on what other indicators are telling us. 

Personally, I take the signal as a warning, especially a warning to look at what price is doing:

1. Price has put in a H&S top that has a target of 3.19 IN PLAY, as long as GIGM trades below the neckline.

2. Price rallied to 4.58 yesterday, five cents below the Bearish crossover,  got "locked out," and sold off to the neckline at the close.

3. The last two candlesticks on the weekly chart look bearish.

GIGM needs to stay above the neckline, and to get above the Tenkan-sen/Kijun-Sen at 4.635-4.64.

Thanks for your technical analysis Melf Elf 

QuoteI wasn't going to comment any further, since comments on the short-term are inappropriate in this folder, given your longer-term perspective, but I decided to "throw it out there" and post this, since it "could have' at least medium-term implications.

Lol, don't even think about not posting short term analysis on this thread. It is suited to that purpose. When you talk about my «longer term perspective» it feels like you're calling me «old man», please stop it 

Well, at least on the short term , I was wise about not selling GIGM at that low point below $4. The stock made a nice rebound but the general market weakness took it down a bit by the close. Also previous support at $4.5 is acting as resistance now.

If the market didn't weaken by the close GIGM could have closed higher than $4.5 and clear the way for a push to new highs above $5.5. I believe that will happen today or early next week. We'll see.

Look how the stochastic oscillator came out of oversold territory. It looks like the chance to buy in oversold conditions has passed, did you buy? 

Quote from: David Randolph on February 10, 2006, 08:19:47 AM
When you talk about my «longer term perspective» it feels like you're calling me «old man», please stop it 

Look at it this way, David:  You can afford to have a longer term perspective because you are a young man, so it is a compliment.

 

Quote
Look how the stochastic oscillator came out of oversold territory. It looks like the chance to buy in oversold conditions has passed, did you buy? 

No, when a pattern has broken (the H&S top in GIGM), I tend not to trust those signals.  Stochastics is bounded by zero and 100, so eventuallly, there will be a "bullish cross" at some point, but it might only produce a rally to resistance, like we've gotten so far in GIGM.   We'll see if it produces something more than that.

Often, strong moves in a stock come from overbought/oversold conditions. 

For example, stochastics in GIGM got overbought when the stock was at 3.80, then stochastics went below 70, and below its signal line.  That might look like a sell signal, but it was a "false sell." The stock rallied to 5.63.  We could have the same thing on this selloff (a "false sell"), but again, the pattern break makes me cautious.

I don't have a postion in GIGM, so I hope that it rallies to new highs in both the short and the long term (for both young and old people, alike).

I believe David was a bit sarcastic wirth you, Melf Elf when he asked whether you'd bought or not at the slow stochastic crossover. You did not have to explain why you stayed out though. What's important is why you reckon investors are and will be attracted to the stock when you decide to buy, who gives a damn about the stochastic! But your analysis is often interesting to read, so keep it up and thanks! 

Hello 

I made the question «did you buy?», not specifically to Melf Elf, but to anyone reading the analysis. But I should have ask: «Did you buy or sell?», because, I know a trader only concerned with technical analysis would have sold, but someone with some fundamental knowledge of the company would have hold/add, as I did.

What happened with GIGM explains why I consider it almost impossible to be a long term investor solely based on technical analysis. There are too many false technical signals.

Although the Stocks on Fire is a trading portfolio, as said the objective of this portfolio is to beat the Long Term on Fire Portfolio's performance, and I can only do that by buying low and selling high.

Going back to GIGM's analysis, we don't have any news since January 5th. Anytime we may have a press release from the company, certainly a positive one. Technically we're above $4.5, again, so that resistance didn't last long.

The way is clear for GIGM to challenge and break the previous high of $5.63. Since, according to Melf Elf's analysis (which I thank and applaud), GIGM had a false technical breakdown, probably now we'll get a genuine breakout of the former highs.

David, is that INSM chart.. I thought you're doing an update for GIGM

Quote from: David Randolph on February 13, 2006, 05:14:19 AM
a trader only concerned with technical analysis would have sold, but someone with some fundamental knowledge of the company would have hold/add, as I did.

What happened with GIGM explains why I consider it almost impossible to be a long term investor solely based on technical analysis. There are too many false technical signals.

David,

Yes, I definitely would have sold the break of the H&S top, regardless of how good the fundamentals are, which is why I would make a lousy investor.

Quote
The way is clear for GIGM to challenge and break the previous high of $5.63. Since, according to Melf Elf's analysis (which I thank and applaud), GIGM had a false technical breakdown, probably now we'll get a genuine breakout of the former highs.

As I see it, GIGM has three areas of resistance to get through:

1. The down trendline off the 5.63 high.  GIGM closed right on it on Friday, at 4.70.

2. The rising Kijun-Sen (solid red) on the Ichimoku Kinko Hyo chart (next post).  It's had a Bearish Cross with the Kijun-sen, and price now is chasing it from below.

3. The Right Shoulder of the H&S Top, at 4.96.  If GIGM clears it, that would CANCEL the H&S top target of 3.19 that now is ON HOLD, as long as GIGM remains above the neckline.

Quote
Going back to GIGM's analysis, we don't have any news since January 5th.

I think GIGM should be due to report earnings soon 

Berloga, thanks for comments. 

ICHIMOKU KINKO HYO CHART

Here's an example that might help to illustrate why it's important for GIGM to get back above the right shoulder, which was 4.96.

Like GIGM, ASTM broke below a H&S top on August 18, 2005.

Also like GIGM, ASTM climbed back above the broken neckline, leaving the possibility of a double neckline (GIGM's double neckline possibility is the two lows of 3.90).

ASTM never took out the high of the original right shouder, and it then fell and broke BOTH necklines on September 9, 2005, completing a double H&S top.

That's why it's important for GIGM to close above 4.96, the high of the right shoulder.