My opinions on the price action change intraday because IMO there is no accurate way of knowing what will happen 3 days from now especially with such a volatile spec stock.
There's things you do with stocks like BHP that have a lot of liquidity, but these ones just run on the sniff of whatever is going around at the time.
That's why IMO the price and volume day to day are really the only telling thing. If you start making predictions 2 or more days out on the short term price, you're opening yourself up to all kinds of variables that are IMO totally unpredictable.
Is price going back to the bottom of a pitchfork that Erich drew on his chart? Not likely IMO! It's just trying to find fair value in a world of all sorts of different traders and investors and world news.
I have a book at home that has back tested all the popular patterns and it's a REAL eye opener. It burst my bubble in a matter of weeks and I had to re-think everything I had learnt about TA.
Honestly I reckon the only people that make money out of things like pitchforks and fib levels and are the ones who sell the idea in books and brokers. They don't care if they work or not, they always make money regardless. Sure I use Fib levels but mainly to guage the strength or weakness of a stock by the depth of it's pull back. And only for price targets IF it converges with something far more reliable.
Also a very successfull pro-trader once said - throw away all those TA books as they are almost useless. But read Market Wizards.
ANP Price at posting:
26.0¢ Sentiment: LT Buy Disclosure: Held
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