What a great week it has been our large buyer had no options as the bots hit that brick wall on Monday and Tuesday as volume was low and the pickings were few and far between, as the sellers had withdrawn. Wednesday we saw a spike in price as volume almost hit 400k. Thursday saw a retrace back toward the middle of the keltner Channel which was not unexpected as our buyer tried to gain the upper hand. Volume was just over 210K. Friday again we have seen the sellers retake control as the price traded outside the upper Bollinger Band. Volume was also up at just over 250K. By close we were just outside the Keltner Channel but still inside the Upper Bollinger Band.
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As I tend to base my predictions on Keltner Channel and Bollinger Band Volatility, combined withother externalinfluences, I will try and give some insight into the week ahead.
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As we finished inside the Bollinger Band there was no strong signal as to a breakout that closing outside the Bollinger band may have given.
We are still under the influence of a very large buyer and seller so that fight is far from over.It is very likely that we will see further consolidation around the $3.30 mark next week as we trade sideways. The Bollinger Band should continue to contract as we bounce along with-in the Keltner Channel.
On a final note Long -term MACD is still Red (negative) short term is in the green.
One final thing this pattern is still in play.
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The technical analysis has been hotly debated this weekand a number of contributors have made some very good points W3hunter, yannpiot, EWexplorer to name a few.
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Will leave you with this,
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Whether technical analysis actually works is a matter of controversy. Methods vary greatly, and different technical analysts can sometimes make contradictory predictions from the same data.
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In a paper published in the Journal of Finance, Dr. Andrew W. Lo, director MIT Laboratory for Financial Engineering, working with Harry Mamaysky and Jiang Wang found that:
“ Technical analysis, also known as "charting", has been a part of financial practice for many decades, but this discipline has not received the same level of academic scrutiny and acceptance as more traditional approaches such as fundamental analysis. One of the main obstacles is the highly subjective nature of technical analysis – the presence of geometric shapes in historical price charts is often in the eyes of the beholder. In this paper, we propose a systematic and automatic approach to technical pattern recognition using nonparametric kernel regression, and apply this method to a large number of U.S. stocks from 1962 to 1996 to evaluate the effectiveness of technical analysis. By comparing the unconditional empirical distribution of daily stock returns to the conditional distribution – conditioned on specific technical indicators such as head-and-shoulders or double-bottoms – we find that over the 31-year sample period, several technical indicators do provide incremental information and may have some practical value.”
Go to THE JOURNAL OF FINANCE • VOL. LV, NO. 4 • AUGUST 2000 for further reading,
https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.134.1546&rep=rep1&type=pdf
What ever method you use just enjoy the ride this one is going to be fun.
all the best
FireflyOne
The writer's opinions are his own and do not constitute financial advice in any ways.Nothing here constitutes an investment recommendation nor should anything written here or published by myself be relied upon for any investment activities.I strongly recommend that you perform your own independent research and/or speak with a qualified investment professional before making any financial decisions.
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