We didn't get the negative market response today that I thought would cause the start of a move down into the $2.80's. To me, it was worth not buying yesterday to make sure I didn't buy before a fall started.
To answer some of your questions, I don't put orders in advance. I would have seen the weakness take hold and started buying anywhere in the $2.80's. Not with an order at $2.81. The pattern I thought might take place would not have gone under $2.71 anyway. So forget the $2.50 scenario. Trading to $5.00, that will take months, so can buy for a lot less getting to $5.00, say before $3.50. Technical analysis is about shapes, patterns. Most times they work.
Let me show you quickly why I thought a fall could come.
Four examples of just before reporting (during different periods while Penn CEO) where a peak was made followed by another attempted rise but fell short, then stalled around until the report. The RSI during all of these cases formed clear negative divergence. Then the fall started. These two very clear features were present in all 4 examples and were signs to get out.
We had this exact same set up at yesterday's close. So for me, having 4 examples of it in the past, was worth to wait and see.
In short, today's strong rise has for now at least negated these patterns. It was very worth waiting to see.
The other is that I likened the price action developing since August 2020 to exactly that of August 2010. As shown in the lower charts. Remarkably similar. I did a successful trade in October and November last year during the grueling fall from 13 August to 29 October where I predicted where the bottom may be and made 20k on the sharp bounce during early November. I based that trade on the duration, the bottom and that sharp bounce all on the similar October, November part of the 2010 chart as shown.
You got to experience the chart to believe in TA. It kind of takes 10-20 years of being there, seeing it take fold. It doesn't work 100% of the time but it is a very powerful tool to know and have.
Mind you, look at the eerily similar shapes and we still might get the fall I'm depicting. But now (with the TS half year accepted by the market) the falls are likely to be caused by a world market sell off post ex div. The ex div part causing the 8c step gap drop, then further deterioration coming from ex div weakness + world market shake up. And I feel we are due for a correction after the markets roaring up like Covid never happened. And I even said back in March that markets will do a V recovery as if nothing happened. But I got it wrong. Everything else did a V except TLS.
Final image is headlines saying how profits fell. Yes, financials not looking good at all. A company once earning 1.8-2.0 bil half yearly, now barely able to scrape in 1.0 bil per half year. It only went up today because the market is hoping and assuming this is the disruption and earnings bottom and it can't get any worse. But if at all the market got wind of earning not recovering as hoped, TLS will be quick to fall down under $3.00.
If you were to calculate the PE ratio for the current state of earnings, TLS is expensive. Example:
Shares on Issue: 11,893,297,855
Full year earnings 2021 say: $2,000,000,000
Price=$3.25
EPS=2000000000/11893297855=$0.168
PE Ratio=3.25/0.168=19.34.
We all know that a PE of 15 or less is reasonable.
TLS is priced to earn $2.5-$3 billion next year and year after. Not going to happen.
However, even considering the weak results, TLS is bullish. My plan is to buy this in the next 2-4 weeks using the hourly and 4 hourly chart after making sure there is no fall to back under $3.00.
In the very short term, TLS will touch and trade at $3.29.
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