weekend charting 6-7 november take 2, page-183

Hello Andrew,

It was only meant to be a simple chart. I put the purple dots on a few points of significance. And also missed a few corresponding ones if you don't understand it is partially my fault. Some points to note are below:

1. 195 EMA. I highlighted that every time that the price hit the 195 EMA it just seemed to bounce off it, hence the extrapolation that it may hit it again in the future and if it does, it may bounce.

2. The RSI (Relative Strength Indicator) is a measure of oversold or overbought. A very simple indicator. Generally if the RSI is less than 30 then it is oversold and if it is greater than 70 it is over-bought, though I find that these numbers need to be taylored to a specific stock. The 50% mark is the point where buyers outweigh sellers (if RSI is rising) which is why it is significant. If you have a look at the chart you will notice that price increases after a rising 50% RSI value. I have highlighted some of these points with pink circles.

I note that a change in direction in the RSI is more important than strict values such as 30 or 70 as mentioned above. I have noticed that short-term trends in this stock can be predicted quite nicely with the RSI indicator, which is why I mentioned it.

3. The arrows are just some short-term repeating ranges that I have put on the chart, which indicates to me (at least) that the short-term move up is nearly over and a small correction is due.

I don't want to steal someone elses thunder, so I think that it is important to note that points 1 and 3 above I have copies from Robx7's trading strategies as presented on HC. Rob, I appologise in advance if I have made a mess of what you do.

I hope that the above makes sense.

Jim