I knew EFSF was just ready to break out. The chart was just too perfect for the stock to not have a great day yesterday.
So-what now? What if you didn’t “accumulate” as I suggested back on April 10th and get positioned for yesterday’s big surge? What if you want to buy the stock? How do you do it without chasing the stock and paying too much?
My guess, the stock is now going to enter another series of higher lows and higher highs, which I hope ends up in a very significant long term break out.
Here’s what we do- go back to old reliable- accumulate the stock when it gives back 61.8% of its recent gain. Where is 61.8%? Glad you asked:
Here’s the chart:
The 61.8 is circled. It’s just under $.38. Remember- this is a very short term look. Just a matter of a few days. Ideally, you would like to see a 61.8% retracement that holds and extends out for a number of days while the volume dries up. The longer the time frame, the more accurate predictor.
Here’s another guess- I believe we will now embark on a another series of events from EFSF. After being quite noisy, the company was rather quiet for about a month.
This company has a history of making noise in the 4 months I have covered it, and I expect that trend to continue until proven otherwise.
Therefore, $.38 might prove to be the right number, with the next surge taking the stock above yesterday’s high of $.425. When you’re looking this short term, it’s tougher to predict, but the principles still apply.
Here’s what I find amusing- What if a NASDAQ stock had jumped from $35 to $42.50 yesterday- a $7.50 move? It would have been all over CNBC and the Wall Street Journal. Yet, in our little market, it doesn’t get recognition.
Oh well- I’ll take the percentage gain, and look for another.
Comments and questions are welcome.
I feel like I just recieved the proverbial “Punchers chance” I live in Okinawa so I put a sell order in for .425 to pull some profit (for a change) and get in on NIHK. Wha a suprise in te morning when I wole up and saw that I had nailed the days high. Looks like I am going to be looking for that .38 mark. Any chance I will get my southland shares in time to jump on this???? Thanks for the lessons.
Editor: Wow- you have to get up early. Put in your limit orders before you go to bed. No chance your Southland shares will be liquid any time soon, but someday. EFSF and CPNE are the two to focus on now for trades. Great job.
so you havent told us how many shares have you bought with your own money? Just what I thought zero.You said to buy at .37 but not at .40 I find that silly.When you buy let us know until then you are just a cheerleader.
Editor: I am just a cheerleader, so don’t buy any. I don’t care. It’s going where it’s going with or without you. Could be up, could be down. However, the entry levels are simply designed to help people trade better.
It’s down .03 already today. Do you think this is a shakeout of weak hands? It’s below the price of your retracement.
Editor: I believe people are selling out in front of the summer months right now. Might be the right thing to do, might not. If history repeats itself we will be out to mid August before micros pick up again. If not, they are doing the wrong thing. Seems to me there is some risk being out of this stock.
What happened to your retracement theory? Called it wrong?
Editor: Not sure what you mean by wrong. I said a good level to buy the stock would be about $.38- I didn’t say it couldn’t go any lower. If you bought it, now you have to set your SSL- will share some thoughts on that in the next few days. As far as being wrong- it’s way to early to say this call was wrong, but I will certainly be wrong many, many, many, many times in the coming days, months, and years. Show me a trader/investor who is never wrong, and I’ll show you a very wealthy person who doesn’t need to make a living.
Good answer. You admitted that your human. LOL! I just didn’t think it would get lower than 038. Thanks
Editor: No, what I said was if you want to buy it, $.38 would be a good, lower risk entry point as opposed to where it was trading at the time- $.41- Of course it could go lower. If you buy it at $.38, and it goes lower, you have to start thinking about your SSL.