Is MYX a bargain, page-504

Hi grayza,

As I explained in a couple of the charts I posted earlier after the upthrust a few weeks ago MYX had a short term distribution from the upthrust which followed by a break of the ice and now subsequent downtrend. This is within a long term accumulation base. You can see in the standard accumulation model that often after an upthrust within the trading range the stock will usually either head to a point of demand which can either be at a higher level of support from the lows of earlier in the range, but it could also be at the lows of the range or even make a slightly lower low than the beginning of the range as per the chart below. This final low is labelled a spring as it will often quickly rally back from this point. The spring is often the last point that signifies accumulation as the final capitulation sellers sell out (assuming that breaking a prior support marks the start of a new downtrend and finally give up). After the spring the composite operator who is accumulating throughout this period then begins to place higher and higher bids as they soak up the remaining supply - this is then noticed through other technical analysis as putting in higher lows etc, until the uptrend becomes much more noticeable again.




Guessing where exactly the spring will occur in this part of the range is difficult but you can use prior support levels to guess where the composite operator will absorb the supply - 50c, 48c and 43/44c are all possibilities. I have a buy order at the lower end of the range at 44c to add more in case there is a spring as low as there, if it doesn't go that low then I'll move my order up. You can also use other trading indicators for a possible idea - the relative strength index (currently around 45) is heading towards an 'oversold' condition at 30, it is likely that once it hits anywhere between 20-30 the price will spring back. Accumulations take months to complete and an upthrust within it getting sold off isn't anything to get worried about imo, though admittedly it can make you impatient waiting it out.