ESLR - Sector: Technology---Industry: Semiconductors

[Melf Elf]

Thank you Melf Elf...

My stop loss was too tight An another lesson for me...

seb,

Oh, no!  I didn't realize that you were stopped out.  That's okay.  You're doing great, the way that you're structuring these trades.  Applause.  Keep up the good work!   

[sebfr]

Hi,

Sold your sell positions...We can see an harami + Hammer with high low shadow near support.

Buy this stock...Few risk...3% of risk..

[cumulina]

Back in at 8.06. 

Totally emotional decision, gut feeling, hoping (!) for news soon, it can't get any worse, etc. etc.

One small thing that influenced me was that REC.OL announced that they are going to quadrouple production, and as they are partners with Evergreen...

We'll see!

Good luck all!

[Melf Elf]

ESLR failed at 10.42 last Friday on a Bearish Inverted Doji Star Hangman, within three cents of the bottom of the broken channel (pattern in purple), which came in at 10.4513.

The 7.99 target (bottom of the Bearish Rising Wedge) from the September 6 break of the pattern MADE yesterday, within one penny.  The low was 8.00 even.

ESLR has got a chance of a "W-Bottom" here, with the 7.99 - 8.00 lows in place, but 7.51 still is IN PLAY from the break of the Bearish Rising Wedge, and it's got momentum to the downside, closing near its low of the day and the week. 

[cumulina]

Thank you, Melf Elf.

I hope ESLR will cheat your chart today... it's running now on good volume.

[Melf Elf]

I hope ESLR will cheat your chart today... it's running now on good volume.

cumulina,

Good example of why I said on Friday in Melf's workshop, when ESLR was at 8.06, "Don't step over dollars to pick up dimes." 

The 7.99 target MADE, and with ESLR down more than 50% since the Bull Trap high of 16.25 in April, it's a bit much for the shorts not to cover.  I suspect that a lot of yesterday's good volume was some short-covering by those who 'stayed too long at the fair" in their short positions.

If I remember correctly, yesterday's Bullish Engulging pattern also is one of Erik Hadik's Bullish 2-Close Reversals (TM): The stock makes a new low (the 7.90 low, yesterday), then rallies and closes above the prior two days' closes.  And, as you say, cumulina, the volume was good.

ESLR has got a chance of a "W-Bottom" here, with the 7.99 - 8.00 lows in place

The lows are 7.99 and 7.90, but the "W-Bottom" still is a possibility.  It needs to take out 10.42.

Basis the Ichimoku Kinko Hyo chart, the Kumo (Cloud) is overhead resistance, at 9.25 - 10.75, and the 10.00 - 10.25 trendline (purple) that was resistance on the last rally attempt also comes in near the top of the Kumo (Cloud), so ESLR has got some work to do, to get through all of that. 

Yesterday was a good start, though, with both the nice candle and the good volume.  We'll see if it's got legs.

Good luck, cumulina!

[Melf Elf]

I suspect that a lot of yesterday's good volume was some short-covering by those who 'stayed too long at the fair" in their short positions.

The rally off 7.90 ended at 8.80, five cents above last support, at 8.75, which was the bottom of a Bear Flag/Bearish Rising Wedge. 

"Former support 'should' act as resistance."  It did.

Yesterday was a good start, though, with both the nice candle and the good volume.  We'll see if it's got legs.

The return to today's low of 8.09 suggests that the rally to 8.80 was a short squeeze and a "momo" driven rally.   

ESLR needs to hold the 7.90 - 7.99 "W"-bottom, then take out 8.75 - 8.80 resistance.

   

[nullzero]

Getting tempting to buy some ESLR soon at these prices.

[Melf Elf]

Getting tempting to buy some ESLR soon at these prices.

nullz,

Granted, ESLR certainly looks cheap in comparison to where it was at 16.00+ at the Bull Trap fakeout in April, but Tuesday's rally, then failure at DOUBLE resistance, doesn't look good.  And, we know that "cheap can get cheaper."

The bottom of the last Bear Flag was 8.75.

The down trendline (black) off the 10.42 high came in on Tuesday at 8.85.

Tuesday's high: 8.80 , smack in the middle of DOUBLE resistance. 


So, what we've got is a stock that:

1. Is in a bearish trend

2. Failed it's first rally attempt off a possible "W"-Bottom at DOUBLE resistance.

3. Still has 7.51 IN PLAY

ESLR needs to take out 8.80, which also would take out the down trendline (black), and start to attack resistance.  Otherwise, it's in danger of falling of its own weigh, like FPP did this summer, since the path of least resistance is down.

I'll show you the FPP chart next, to illustrate my point.

[Melf Elf]

nullz,

After breaking below a double bottom at 6.75, in May, FPP had a chance of a "W"-Bottom, at 4.80 - 4.81.  It's base was a little broader than the one now, in ESLR.

On it's first rally attempt, FPP failed at DOUBLE resistance: 6.04, and the 50DMA.

FPP now is at 2.69. 

You see why I say that ESLR needs to take out that 8.80 failure high, at DOUBLE resistance.

[Melf Elf]

You see why I say that ESLR needs to take out that 8.80 failure high, at DOUBLE resistance.

The 8.80 high is data point #3 on the down trendline, validating it as resistance.  Today's rally above it is a positive, and volume is decent.  A print of 8.81 would be a "higher high," and would another postive.

[Melf Elf]

A print of 8.81 would be a "higher high," and would another postive.

ESLR rallied only to 8.75 on the intraday trendline breakout (chart above). 8.75 was the bottom of the last Bear Flag, on September 12.  Selling came in on Friday right there, at resistance.

[Melf Elf]

Selling came in on Friday right there, at resistance.

Follow-thru selling on the failure at 8.75 - 8.80 resistance, back to the Double Bottom, at 7.99 -7.90.

Triple bottoms in a bear trend are tenuous: "Three times, and through."  The technicals look weak (see MACD chart next post).  Bulls need to knock out that 8.75 - 8.80 resistance to get out of Harm's Way.

[Melf Elf]

MACD

[Melf Elf]

[Triple bottoms in a bear trend are tenuous: "Three times, and through." 

That proved to be the case this morning.  The Triple bottom broke just after the open, and the 7.51 target MADE, within six cents.

The first rally attempt off the 7.57 low, back to the Triple Bottom at 7.99...7.90...7.97 failed at 7.97.  Everything above the Triple Bottom is now resistance.   

Bulls could do with a Bullish Hammer/Bullish Doji Star today.