Luke: "I don't believe..."
Yoda: "That is why you fail."
Sentiment Analysis of RIM
Many anticipated the post earnings sellof and that may be enough reason for it NOT to happen, just yet. Perception is that RIM is en fuego, so trade the tape you are given based on that, not the one you want. Shorts who attempted to frontrun the fallout may have jumped the gun. Previous price patterns do not always predict behavior. THAT IS A MENTAL TRAP. Even if your fundamental thesis is rational, RIM and the market are NOT. There are thousands who are anticipating that same short trade, just like you. And frontrunning an earnings sellof is an easy way to get "RIMM-sawed". Many mistook the consolidation/pullback as a signal for the beginning of a selloff. Yes, MM ARE in the business of "anticipating the anticipated". But, based on the price action, I don't see manipulation here like many are quick to point. Be disciplined enough NOT to trade and patient enough for the right entry. The short trade will arrive soon, but just not yet...
Technical Analysis of RIM
Here are the pivot points for today (see chart). Floor traders use these points as reliable S/R levels intraday. Data from the previous day is ued to calculate potential turning points for the day you are about to trade (present day). I have used these for years and find they are predictive as opposed to lagging. Because so many traders follow pivots you will often find that the market reacts at these levels. This gives you an opportunity to anticipate reactions intraday.
Tuesday move up was NOT on weak volume. When determining a valid move, volume should be measured against the average daily volume (ADV), NOT just against the previous days' volume. PVO is a better method to assess buying and selling pressure within volume, and is near +6 which indicates buying pressure for RIMM is still positive despite coming off higher levels during earnings. Bullish Piercing Pattern on the candles indicates further upside. It will be crucial to stay above 120 to keep the current bullish trend intact. Major resistance at 124. If this is broken, watch for a breakout to 130.
Technical Analysis of NDX
(click on image fore detailed TA)
NDX has been rangebound last few sessions but I am expecting another significant move up soon, possibly today. This would also makes sense given RIMMs chart pattern. We are also at the bottom channel of a short term uptrend (see chart). It looks like we may be gunning for the 100dma at 1897 in the next few sessions.
Quote of the Day
“The stock market can stay irrational longer than you can stay solvent.”
Jonh Maynard Keynes
Trade Signal of the Day:
Hold
Disclosure:
LONG RIMM
Video of the Day
Don't Look Back, Just Ride It
4 comments:
I notice with some amusement the issue of shorts vs. longs and timeframe expectations on that message board.
As I understand your previous comments you envisioned that the "takedown" would start this week.
My question: What sort of time frame are you envisioning at present for this event to begin? Are you thinking days (as in 6 or less) weeks (as in April some time) or months (as in June or July)?
Are you going to utilize this blog as stated before and posit a response as to what you really think (as opposed to the cash_wins views of strong buy, strong sell and "way higher baggies").
I presume that if you were attacked by know nothings that happened to have a hysterical near term long view your comments would take the opposite tack.
Regardless I think that very few people are interested in most of the drivel on that message board and are looking for views that have some basis in thought. My sense was that this was the premise of your starting a blog.
I could allow email reponse but that would not be in the spirit of the blog?
seeking truth,
I use message boards as part of sentiment analysis. I find it a microcosm of overall sentiment for RIMM. The downside is that it is easy to get sucked into warped discussions when the audience does NOT want quality ones. Getting banned for posting my blog address proves that. Their loss, as it was highly relevant, not spam.
The timeframe for the "takedown" will be in terms of days. I trade the tape I am given and right now the long trade will be soon coming to an end. I will post THAT trade on my blog when the time arrives.
In the blog, I do a brain dump of my daily DD and thought processes.
Thinking in duality.
They may or may not conflict with my current position. That is why I provide disclosure in each post.
I got a bit off center this week but expect an update real soon.
Cashman
Thank you -- Glad to have you back amongst those that do not live in double wides
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