Black Magic Chart Observation

Halfway through looking at the charts from the Weekend Watchlist Posts, I got to thinking: what would these charts look like if I turned them upside-down?

Honestly, I can’t believe what I’m looking at.

Virtually every stock I’m watching is exhibiting the exact traits I’m looking for when seeking to put on new long positions, only the patterns are inverted 180 degrees.

Ok, I’d like to see the Bollinger Bands contract (a lot) more, but after the rather hot run from last week, I think things may settle down a bit here…so that may happen in due time.

Look at how the volume is contracting right through the trough (peak) of these curves.  Also observe how the daily price ranges are tightening up.  After many years I have found that these are consistently low risk, high reward trade setups (yes, to the long side).

Behold!  MS Paint skills in all their glory:







$SINA: This one has already started to break down.  Observing the inverted chart makes this move seem so obvious, to where I can’t believe I overlooked it.  Declining volume and a lower daily range as it nestles right up against the moving averages.


$CBS: How could you let Gus Johnson get away?  Another nice looking one here.


There are 19 stocks that I’m watching (found in the Weekend Watchlist posts linked earlier).  All are exhibiting some form of the same general pattern with different proximity to the moving averages and the recent relative low.

I’m going to look to start short sale positions in all of the above on any weakness.  My stops will be  pretty obvious.

More on this situation as it develops.  You can follow me on Stocktwits to receive updates.

This entry was posted in potential trades, Watch List, Weekly Watch List and tagged , , , , , , , , . Bookmark the permalink.

One Response to Black Magic Chart Observation

  1. Michael Josemans says:

    short all pops…baby

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s