ATI

[Melf Elf]

ATI did not have the surge of volume, Friday it was down again, does this nulify of put on hold your breakout?

joe,

Yeah, the volume is very poor.  Sometimes, it comes in a few days later, but when stocks close back inside the breakout like ATI did on Friday, the target goes ON HOLD, which means think about whether or not you want to stay long because the breakout could be a failure.

Since the 50/200 DMAs still are bullishly positioned and since the trend is bullish, I'll hold it, but we never like these closes back below pattern breakouts.   

ARNA closed below its breakout on Thursday, but it's back above it at Friday's close, so that one looks to be working out, as it stands.

I wouldn't blame anyone for abandoning ship on ATI here, though.  It's a judgment call.   

If ATI breaks the bottom of the pattern, near 50.24 for Monday, September 11, the upside target is CANCELLED and a downside target would be IN PLAY.

[joet]

thanx Melf, You did mean a break down of 55.24 not 50.24 for a downside break out??

I am still watching, if it breaks 62 or 55 (on a close) with some volume i will probably jump in long or short
Cheers joe

[Melf Elf]

thanx Melf, You did mean a break down of 55.24 not 50.24 for a downside break out??

Joe,

Yes, sorry.  The trendline comes in at 55.2408 on Monday, September 11.

[Melf Elf]

Since the 50/200 DMAs still are bullishly positioned and since the trend is bullish, I'll hold it, but we never like these closes back below pattern breakouts.    

ATI closed back above the Symmetrical Triangle on Wednesday.   

On Thursday, MACD ticked above the zero line.  On Friday, the stock took out, and closed above, the 62.75 breakout high.  I like that.  Volume is lacking, but otherwise this looks fine.

I'm raising my stop to 57.21.  The initial breakout already was sloppy.  I can't justify holding through another break below the pattern, and a takeout of Monday's 57.22 low.   

The risk on the trade now is reduced from a loss of 9.3%, to a loss of 6.1%.

The chart work, technically, is done.  The stock made its first "higher high" in some time, on Friday, and ATI is "champing at the bit," for its first close since May above the top of the Kumo (Cloud) on the Ichimoku Kinko Hyo chart.

That chart next, then the MACD chart.

[Melf Elf]

The top of the Kumo (Cloud) is at 63.145.  Friday's high was 63.49, which was the first penetration since the May breakdown.  Friday's close was 62.99, so it's right there, poised to move higher.

[Melf Elf]

MACD chart:

[joet]

Thank you for the Analysis Melf!

I will be looking to buy a few shares on Monday, hopefully on a intra day weekness in the low 62s...  Do you have an entry strategy once you like a stock?  It is looking like ATI will go up this week, but i also see that it consistantly has about a $2 spread on the day.  In your opinion would a buy order around 62.20 have a good chance of filling or missing the next run!  If this question seems to absurd feel free to tell me so    I like hearing peoples strategies... buy the open, buy the high, buy the dip etc.  I personally like trying to buy the day after a good move up at about 1/2 the previos days candle... but i have missed several with this as well.
Have a great weekend Cheers Joe

[Melf Elf]

Do you have an entry strategy once you like a stock?

Joe,

It differs.  Sometimes, I'll but what "looks like" support, prior to a breakout, like BDCO.  If that isn't support, I stop it out, also like BDCO.  Sometimes, I'll buy the pattern breakout, like ATI last week.  Other times, I'll buy a pullback to the breakout, if I can get it. 

While those situations differ, the most important part of my entry strategy is ALWAYS to look at the risk:reward on the trade.

In your opinion would a buy order around 62.20 have a good chance of filling or missing the next run! 

That's always a guess. 

Given the lack of volume, I'd say that increases your chances of getting your 62.20, or even lower.

Since ATI was sloppy on the breakout, going back inside the pattern, it might even go all the back to 60.015 -60.3625 support to "get it right this time!" 

I hope not, since that will make me squirm a bit. 

60.3625 is the bottom of the Kumo (Cloud)

60.355 is the 8-day Tenkan-sen (solid green line)

60.015 is the 22-day Kijun-sen (solid red line)

What we don't want to see, is ATI break the bottom of what could be a "morph"  (change) into a Bear Flag (the pattern in purple).  The bottom of it was validated by a 3rd hit on Monday's 57.22 low, a penny below which is my 57.21 stop.

The 200DMA is below there could be support, currently at 56.794, but if we see that, I wouldn't like:

1. The break back below the Symmetrical Triangle again   

2. The break back below the Kumo (Cloud) 

3. The break of would could be a Bear Flag (pattern in purple) 

4. The print of a "lower low," below Monday's 57.22. 

I'll stop it out if I see all that mess. 

If this question seems to absurd feel free to tell me so 

Not at all, Joe.  You ask good questions.  Sorry that I can't or don't answer them as thoroughly as I would like, and more often than not, there isn't a "pat" answer upon which we always can rely.  If there were, this gaime would be easy, and we know that it ain't.     

I like hearing peoples strategies... buy the open, buy the high, buy the dip etc.

Again, I'd say most traders employ different strategies, depending upon the individual chat, as far as buying support, or buying a breakout, etc.

I personally like trying to buy the day after a good move up at about 1/2 the previos days candle... but i have missed several with this as well.
Have a great weekend Cheers Joe

That can be a nice strategy, to buy a retracement of half the candle, as you say, or even a .618 Fibonacci retracement of big white candle. 

It worked beautifully in GIGM, the day after the big white candle on September 7.

September 7 high: 11.27

September 7 low: 9.68

11.27 - 9.68 = 1.59 points

1.59 points X .618 = 0.983 points

11.27 high - 0.983 points for a .618 Fibonacci Retracement - Target: 10.287 for next day entry.

Next day's low: 10.25.

Buy the retracement, and sell it when the intraday Symmetrical Triangle target: 11:48 MADE on September 13 (that was a return to the top of the pattern) for a gain of 11.6%

Stop would be below the low of the white candle, which was 9.68, so 9.67.

Entry at 10.29.  Stop: 9.67.  Risk: a loss of 6.03% , so that's about a 1:2 risk/reward, which is fine.  You've also got the option of selling ½ for the 11.6% gain, and seeing what develops on the intraday chart, etc.

Now that I think about it, I'm pretty sure that Se7en re-entered GIGM right at 10.28, after selling it above 11.00, then he sold it again above 11.00 (I think).  I don't know if he used the .618 Fibonacci retracement for his 10.28 re-entry, but that was nice trading!

I have to applaud se7en for that, in case I forgot do it. 

[joet]

Hi
Not sure who called it first for GIGM, but I learned the strategy from FOUS, on his technicaltrader website.  Buying 1/2 the tall white candle the day after a break out has been working well for him.  Applaud to Fous! and as always to you Melf, thanx for the response.
Cheers Joe

[Melf Elf]

Hi
Not sure who called it first for GIGM, but I learned the strategy from FOUS, on his technicaltrader website.  Buying 1/2 the tall white candle the day after a break out has been working well for him.  Applaud to Fous! and as always to you Melf, thanx for the response.

joe,

Yes, that can be a nice trade, or possibly buying a tall white candle retracement before a breakout, if the chart looks strong enough.  I'm thinking of Friday's white candle in ASTM, for example.  I'll post a chart in that folder.

[joet]

yoo  Melf
Been thinking of you as i watch the downs and ups of ATI, so i had to look back to your stop, Looks like you are still Long!  and that is good after todays action...  but is this just a quarter end spike?  Still a sloppy break out? or does todays clean it up some for you?  I am still on the sidelines.
All metal stocks did well today!  Think that ERS may have turned a corner! 
Cheers Joe

[Melf Elf]

yoo  Melf
Been thinking of you as i watch the downs and ups of ATI

joe,

It's been more downs than ups lately!   

so i had to look back to your stop, Looks like you are still Long! and that is good after todays action

Yep, still long.

In the "Damned if I do...damned if I don't" department, as you know, I haven't liked the lousy volume in ATI since the Symmetrical Triangle breakout.  I was going to sell it at $65 and try to get back in lower, but I did that on AAPL and got punished for it.  AAPL didn't go down much at all.  I never got back in, and the 76.05 target MADE with me sitting on the sidelines.

Curses!   

So, what happened with ATI when I didn't sell at $65?  It dropped to $57.97!

Curses!   

but is this just a quarter end spike?

Dunno.

Still a sloppy break out?

It's improving a bit.

or does todays clean it up some for you? 

Yes, it does.

Tuesday was a re-test of the top of the Symmetrical Triangle, the close almost was a Bullish Hammer, and volume picked up to 3.2 million.  Yesterday was a nice white candle, following through to the upside after the successful re-test of the triangle, and volume improved to 3.5 million.

[Amarens]

Hi Melf, hi Joet,

I'm also long on ATI. Since the August 14th fall it seems to make higher highs and higher lows. Moving the right way 

I like what I see! Finally...

Amarens

[Melf Elf]

Joe and Amarens,

I'm long at 60.90 since the September 5 breakout. 

The chart still looks okay, but if ATI has much of a down day, MACD will go down through its signal line.  Volume hasn't been good.  If ATI sliides into the high 60.90s, I'll make a safety play and sell it for a fractional percentage gain.

[Melf Elf]

MACD