Technical Analysis of Stock Trends

Waiting for the next stimulus to drop.

Posted on Feb 14, 2009 by WHC Bassetti.

You knew we were speculating about the upwave, right?  We have been hitting bottoms with such regularity lately that we got too smart for our own good.  This chart is, of course, miserable.  Maybe Monday will cheer it up.  After all those poltroons we call politicians did pass a stimulus plan so money will be gushing forth from Washington.  And none too soon.  Every economist we know (except the Cato Institute guys and we can ignore them now) thinks it’s not big enough.  That’s what we think too.  There will have to be more.  But the fact that Obama can move Congress at all with an obstructionist conservative reactionary Senate minority is positive in itself.  Few observers really credit the ability of 41 senators to road block legislation.  To have gained support from 3 “moderate” Republicans and break the logjam is really quite amazing.  Not one Republican representative voted for the package.  Talk about post-partisan.  

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Platinum! Platinum! Platinum in….

Posted on Feb 13, 2009 by WHC Bassetti.

Our platinum trade is working nicely.  Readers should take a look at it.  The risk is relatively low at this point.  Without a doubt our students cringe as at the nun’s ruler when they hear us say it for the umpteenth time, be there at the beginning.

The gap is a buy signal, as was the breakout over the horizontal line.

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Gold! Gold! Gold in …..

Posted on Feb 12, 2009 by WHC Bassetti.

We’ve been looking for the top of the wave in gold too.  As all readers know you’re not supposed to do that unless you are trading against your position.  And, trying to pick the top sometimes cheats you of the subsequent up move.  And you can see a buy signal in the gold the last couple of days.  Not a roaring signal, but a signal.  We’re not buying anymore right now, but if you were really aggressive this is an add on signal.  If you’re just trying to get in then it’s a dip the toe in signal.  We haven’t marked all the buy signals on the chart.  We’ll do that in the future.

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Excuse us. We’re nauseous. (from the roller coaster ride)

Posted on Feb 12, 2009 by WHC Bassetti.

As Mark Twain said about the weather in San Francisco, If you don’t like the weather wait a minute.  Midday we were ready to get out the basket and gather up the pieces of the market blown up by the Treasury Secretary.  End of day we were giddy.  From the ride, not from anything, that like Michael Phelps, we shouldn’t have been smoking.  For what it’s worth (not very much in this market) today is a key reversal day.  Key reversal days don’t always reverse the trend but at least it’s something to hang your hat on.  We have been looking for the bottom of this wave for a number of days — until Tim spoke up.  This could be it, so get ready for an upwave.  Unless the emotional/political climate changes (which it could with the stimulus package) we see the upwave confined within the trading range and a continuation of the sideways trend begun October 10.

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Gold. Your correspondent makes an ill advised trade.

Posted on Feb 10, 2009 by WHC Bassetti.

We need one of those whips that flagellantes use to beat themselves with.  Yesterday we scaled out of a little of our gold position.  Every good trader in the world says the same thing.  I didn’t follow my system, and we didn’t.  It had something to do with the full moon, but we don’t want to go into it.  That would be worse than the whip.  Anyway here is the chart with two alternative stop methods illustrated, as seen in the StairStops book.

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