3SOF

Quote from: Melf Elf on May 09, 2006, 09:57:29 AM
Shorted CKCM at 22.75.  Stop: above 24.00.  Risk: a loss of 5.5%.

I'm lowering my stop to 22.26, a penny above the high at 9.58AM.

The neckline broke near the open, but this is a heavily shorted stock.  If bulls aren't going to sell any more than they already have, and if the bears don't have enough conviction to take it back down, I'll cover. 

A short squeeze is very possible if the neckline (20.657) doesn't get taken out again.

Quote from: Melf Elf on May 09, 2006, 10:36:34 AM

Quote from: Melf Elf on May 09, 2006, 09:57:29 AM
Shorted CKCM at 22.75.  Stop: above 24.00.  Risk: a loss of 5.5%.

I'm lowering my stop to 22.26, a penny above the high at 9.58AM.

Covered my short at 21.80.  Gain: 4.2%.

There are two highs of 21.95 in the last hour.  If 21.96 gets printed, this looks like it could rip to the upside on a short squeeze.

Bulls don't look worried about the neckline break.  Bears don't look serious about taking it down.  This sideways action puts me in mind of "Don't be short a dull market."  I took the money.

CKCM currently is BID 21.79...ASK 21.80

Has anyone seen the $15 (72%) gain CKCM made in AH.  Is this for real?  Lets all burn some candles.

Quote from: logocovet on May 14, 2006, 09:32:14 PM
Has anyone seen the $15 (72%) gain CKCM made in AH.  Is this for real?  Lets all burn some candles.

logocovet,

That was a bad quote. 

CKCM gapped down below the neckline of the double H&S Top this morning, and just took out the earnings day low of 20.01.  Individual stocks seem to be getting whacked pretty hard this morning, considering that the NASDAQ is down only 3 points.

The smaller H&S Top (pattern in blue) Target: 19.36 that has been IN PLAY since the pattern breakdown at February earnings MADE yesterday.

The neckline of the larger H&S Top also was broken on both an intraday and closing basis.  Everyone who purchased this stock after November 2, 2005 now is under water, so we've go six months of overhead resistance here.

Quote from: Melf Elf on April 29, 2006, 06:20:57 AM
Based strictly on the chart, the Bears are very well-position to win this one, going into earnings.

The bears have come out of earnings the winner, so far. 

Bulls never managed a serious attack on the Right Shoulder, at 25.40.  Despite heavy short interest (about 40% of the float), the Bears never felt any threat in their short positions, and weren't motivated to cover, which would have helped to fuel a rally that never materialized.

Yesterday's close was 19.76, a penny above the first data point on the large neckline, at 19.75.  The November, 2005 earnings gap (19.20-19.49) was filled yeaterday, now the Bulls need to get this back above the neckline. 

Otherwise...

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Although this sample isn't large enough to be statistically significant, given the recent history of this stock's reaction to earnings and how that trend tends to remain in effect for most of the quarter following the earnings report

CKCM isn't evem res[ponding to the recent good press releases.  Does this mean a top?

Oh, by the way, does anyone have the analysis of CKCM by Motley Fools?  They picked it as one of their Rule Breakers.   

Anyone else think that CKCM might be readying itself for a reversal breakout?  Is getting into the narrow end of a large descending wedge, with several confirmations of both support and resistance, finding support again at the recent low just below $18.  Meanwhile, we have recent positive divergences in both MACD and RSI.  A move above $20 would provide a technical breakout of the wedge, but it would be nice to see it get over $21 resistance to confirm this breakout.  Above this, key resistance levels come in at 22.80 and 25.  Thoughts, CKCMers??

Quote from: Melf Elf on May 16, 2006, 06:37:00 AM
The neckline of the larger H&S Top also was broken on both an intraday and closing basis.  Everyone who purchased this stock after November 2, 2005 now is under water, so we've go six months of overhead resistance here.

The bears have come out of earnings the winner, so far. 

Although this sample isn't large enough to be statistically significant, given the recent history of this stock's reaction to earnings and how that trend tends to remain in effect for most of the quarter following the earnings report

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I made myself a note to look at CKCM in early August.  Sorry I looked.   

Quote from: Melf Elf on May 09, 2006, 12:00:09 PM

Shorted CKCM at 22.75.  Stop: above 24.00.  Risk: a loss of 5.5%.

Covered my short at 21.80. Gain: 4.2%.

Bulls don't look worried about the neckline break. Bears don't look serious about taking it down. This sideways action puts me in mind of "Don't be short a dull market." I took the money.

This was an awful looking chart at May earnings, with the DOUBLE H&S Top, but I lacked the patience to stay with my short position, and I also didn't continue to follow chart afterwards.  Two of my MANY weaknesses as a trader.



A couple of instructive highlights from this chart, for those of your learning:

1. When a big top like this has been put in, short positions are favored on the breakdown, and there often are other opportunies to short later on.  For example:

a. Short the failed re-test of the neckline on June 2 and June 5.

b. Short the breakdown of the Bearish Rising Wedge on July 10 and/or the second failed re-test of the neckline on July 12, which was THE PERFECT SHORT (if there is such a thing). 

I say that because, although CKCM certainly "could have" gone higher after that failure on July 12, the chart sure looks like "give it up to the downside" at that point.  The risk was minimal there.  Stop loss would be cover the short above 21.17, the June 2 high, which was the first failed re-test of the neckline. 

Shorting anywhere along the top of that Bearish Rising Wedge, the risk was about a 3-4%, and there was good evidence to support taking a short position there: the big DOUBE H&S Top, and a Bearish Rising Wedge. 

Those examples are what I mean when I say "pick your spot for shorting (or for entry into a long postion)." vs. just shorting anywhere at all, "in the middle of No Man's Land."

Let me know if that isn't clear.  I'll try to explain it better.

The gain at Friday's close, from the July 12 high of 20.94 (failure at the neckline) is 33%, roughly 8-10 times greater than what the risk was in taking the position. 

Shorting now, at 14.07, is an example of "shorting into the hole."  The train already left the station...we missed the trade.

I hope these examples help with where to short, why we are shorting, and what risk we are taking vs. the reward that expect to gain.

2. See the purple down trendline off the Head, in February?  There were FOUR hits to that trendline, so it was validated resistance.  A breakout above it should have "some" significance.

WARNING: Be very, very careful about considering those sharp down trendline breakouts to be a BULLISH breakout.  They generally aren't, after a big top like this one has been put in.

June 22 was a breakout above the purple down trendline alright, and it was good for a little two week rally as CKCM wended its way back to RESISTANCE at the neckline.  Fine for a little short-term trade, but also very risky.  It's against the dominant bearish trend.  We can see that after that Bearish Rising Wedge breakdown....UGH...resumption of the downtrend, in full force.

Often, after a breakout above a sharp down trendline (purple), the stock "walks down the trendline," not looking bullish at all.  See how it tried to hold at that trendline in July, but it took out the prior lows of 18.28 and 17.90, and then continued lower?  That sure isn't bullish.

Whatever the reason was for the GAP DOWN on July 28, we can't be real surprised, given how awful the chart was looking.

Anyway, just some weekend T2T technical stuff to think about when we're looking at other charts to short (or go long) in the future.

CKCM is looking better - just broke through $16 resistance, and could run to the top of the channel - next stop $18???  Any other thoughts?

hI,

good opportunity to sell this stock..

sell at 17.21
target at 13.80
stop loss at 18.70 (large)

Reward/Risk ratio of  24.7 / 8.6 = 2.87...

Quote from: sebfr on September 02, 2006, 05:29:06 AM
stop loss at 18.70 (large)
Reward/Risk ratio of  24.7 / 8.6 = 2.87...

sebfr,

Nice work, and I appreciate your posting risk:rewards.  Very important, as you've said.  Applause.

CKCM looks to be in the "in betweens:"

1. It broke above the down trendline (purple) off the H&S Top.

2. It also broke above the red channel, and closed right on it on Friday's selloff.

3. It failed at the top of the channel (blue) coming off the Right Shoulder, which came in on Friday at 18.63.  Friday's high was 18.63 exactly, so that was a trendline validation (resistance).

I like your stop. 

The recent decline from the broken neckline to 13.67 was just about straight down, so CKCM could rally back up to the neckline/200DMA (mid-$21s) the same way.  A print of 18.64 would be a channel breakout and a take out of Friday's high, which could bring in both the breakout buyers, and buying from the shorts, covering their positions.

Quote from: ScottishTrader on August 22, 2006, 11:40:58 AM
CKCM is looking better - just broke through $16 resistance, and could run to the top of the channel - next stop $18

Scotsman,

You-u-u got it!  Applause.    

Thanks Melf Elf ,

I appreciate also your works and your help for this community 

You know, it is hard to be a winner trader..I try to be in the right way at least 50% of the time. And i try to make trades with a Reward/Risk ratio greater than 3 so i can be a winner trader. Technical analysis permit that. All the rest it is a good money management and disciplined to follow the initial plan and Humility to accept failure.

Quote from: sebfr on September 05, 2006, 05:29:46 AM
You know, it is hard to be a winner trader..I try to be in the right way at least 50% of the time. And i try to make trades with a Reward/Risk ratio greater than 3 so i can be a winner trader. Technical analysis permit that. All the rest it is a good money management and disciplined to follow the initial plan

sebfr,

You've really got the right idea for trading.  Keep knocking them out, and with the odds in your favor like that, you'll do very well.

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and Humility to accept failure.

AMEN, buddy!  The "need to BE RIGHT" is deadly.  It prevents us from admitting our mistakes, and selling when a trade doesn't go well.  It causes us to cling to losers.  It's better to focus objectively on structuring the trades, and on "playing it right," not on "being right."

You have a very good understanding of that, and it will serve you well. 

Quote from: Melf Elf on September 05, 2006, 04:14:05 AM
The recent decline from the broken neckline to 13.67 was just about straight down, so CKCM could rally back up to the neckline/200DMA (mid-$21s) the same way.   A print of 18.64 would be a channel breakout and a take out of Friday's high, which could bring in both the breakout buyers, and buying from the shorts, covering their positions.

Wow...it's in the mid-22s at the open! 

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And of course a great thank at my own failures !

sebfr,

Yeah, that might be the best teacher, huh?   

ITW to buy Click Commerce for about $292 mln
Tue Sep 5, 2006 8:28 AM ET

NEW YORK, Sept 5 (Reuters) - Diversified manufacturer Illinois Tool Works Inc. <ITW.N> said on Tuesday that it had agreed to buy software maker Click Commerce Inc. <CKCM.O> for about $292 million, including stock options.

ITW will pay $22.75 per share of Click Commerce, a 27 percent premium to the company's closing stock price on Friday.