.............Some Rockets That Appear Timely
I said that AVNR, CEGE, and DNDN would probably be the main focus of rocket trading for a while, but, probably not.
NGEN appears to have recently entered a Cyclical Bull Market after a more than three year Cyclical Bear Market (see http://finance.yahoo.com/q/ta?s=NGEN&t=5y&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c=, but, must also look at 6 month chart, see http://finance.yahoo.com/q/ta?s=NGEN&t=6m&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c=).
In the 6 month chart one can see that NGEN made a huge bullish breakaway gap to the upside on very high volume, and, did a textbook Elliott Wave 12345 up down up down up monthly upcycle, and, appears to have nearly completed (might have completed) the down part of the monthly cycle, having done an Elliott Wave ABC down up down pattern. There are no downside gaps that are likely to get filled, since the 1.26 is the huge 30 cent (25%ish) likely bullish breakaway gap (the nearest unfilled downside gap).
With rocket trading (for now) I'm probably going to wait for a Wave 1 short term upcycle (wait for strength/hit a buy signal, which means that I wait for a monthly upcycle to clearly begin) and look to buy in Wave 2 down. Once I see how well my monthly cycle low targets work I may try to catch bottoms at some point.
Other rockets I might be trading in the near future are:
SUPG (Wave C target 5.75 but buy Wave 2 down, downside gaps at 6.08, 5.90, large bullish likely breakaway gaps at 4.89, 4.61), ERHE (Wave 1/early Wave 2 (huge spike)), PPHM (Wave C close to bottom, no downside gaps, bearish I Watch past week), PPCO (Wave 1, bullish I Watch), LMC (Wave C, buying RNO, target 10.50ish, downside gaps at 12.26, 11.45 (potential breakaway gap), 11.15 (potential breakaway gap), 10.69, 10.58, 9.59 (probably breakaway gap)).
Here's all 7 stocks mentioned in this post (except AVNR and DNDN) 3 month TA charts http://finance.yahoo.com/q/ta?s=ngen%2C+cege%2C+erhe.ob%2C+lmc%2C+supg%2C+ppco%2C+pphm&t=6m&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==.
The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18 month Cyclical Bear Market in the past year or two), etc. I didn't see anything with any of the stocks listed in this post that scared me away, and, ERHE.OB as of the end of last year had over $38 million in cash, which is great for an OTC Bulletin Board stock.
Rockets that appear to be very close to monthly cycle lows are NGEN and PPHM. CEGE could bottom on Monday or Tuesday at 4ish, after filling it's downside gap at 4.31. ERHE and PPCO are in Wave 1 short term upcycles or could be early in Wave 2 down of monthly upcycles.
If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.
There are times when one should wait for strength after hitting a price target (hit a buy signal), such as if there's a well established downtrend line one should wait for it to clearly be broken (might wait for a Wave 1 short term upcycle and buy late in a Wave 2 down or early in a Wave 3 up, in the flat early part of the cycle), and, there are times to consider trying to catch the bottom (when I Watch and the WMT Lead Indicator are clearly bullish and/or a stock bounces at a well established uptrend line, then look to buy a pullback).
I'll be using cycle trendlines/channels, Elliott Wave patterns, gaps, the WMT Lead Indicator, I Watch, etc. to time the rockets. If it works the way I think it will it should be a lot of fun. We'll see.
As a long term multi-year investor in any stock, commodity, etc. you want to buy near the primary multi-year Secular Bull Market/very long term upcycle trendline, for example NEM's is at 40ish right now, see chart 8 at http://www.joefrocks.com/GoldStockCharts.html. Therefore, NEM right now would be a great buy in the 40-42 range. Gold's primary multi-year Secular Bull Market/very long term upcycle trendline is at $470ish right now, so, gold would be a great buy in the $470-500 range. When the vast majority of gold writers say it's a great time to buy or are bullish, as they almost always are, it's rarely a good time for long term investors to buy.
HUI/XAU's Wave 2 Cyclical Bear Market began 5-11-06, see charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html. NEM's Wave 2 Cyclical Bear Market that began on 1-31-06 ended on 10-4-06 at 39.84, so, reliable lead indicator NEM is probably in a 5-6 yearish Wave 3 Cyclical Bull Market since 10-4-06, see chart 8 at http://www.joefrocks.com/GoldStockCharts.html. ....... http://www.JoeFRocks.com/ .
HUI NEM XAU
NGEN appears to have recently entered a Cyclical Bull Market after a more than three year Cyclical Bear Market (see http://finance.yahoo.com/q/ta?s=NGEN&t=5y&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c=, but, must also look at 6 month chart, see http://finance.yahoo.com/q/ta?s=NGEN&t=6m&l=off&z=l&q=c&p=v&a=m26-12-9,p12,fs,w14&c=).
In the 6 month chart one can see that NGEN made a huge bullish breakaway gap to the upside on very high volume, and, did a textbook Elliott Wave 12345 up down up down up monthly upcycle, and, appears to have nearly completed (might have completed) the down part of the monthly cycle, having done an Elliott Wave ABC down up down pattern. There are no downside gaps that are likely to get filled, since the 1.26 is the huge 30 cent (25%ish) likely bullish breakaway gap (the nearest unfilled downside gap).
With rocket trading (for now) I'm probably going to wait for a Wave 1 short term upcycle (wait for strength/hit a buy signal, which means that I wait for a monthly upcycle to clearly begin) and look to buy in Wave 2 down. Once I see how well my monthly cycle low targets work I may try to catch bottoms at some point.
Other rockets I might be trading in the near future are:
SUPG (Wave C target 5.75 but buy Wave 2 down, downside gaps at 6.08, 5.90, large bullish likely breakaway gaps at 4.89, 4.61), ERHE (Wave 1/early Wave 2 (huge spike)), PPHM (Wave C close to bottom, no downside gaps, bearish I Watch past week), PPCO (Wave 1, bullish I Watch), LMC (Wave C, buying RNO, target 10.50ish, downside gaps at 12.26, 11.45 (potential breakaway gap), 11.15 (potential breakaway gap), 10.69, 10.58, 9.59 (probably breakaway gap)).
Here's all 7 stocks mentioned in this post (except AVNR and DNDN) 3 month TA charts http://finance.yahoo.com/q/ta?s=ngen%2C+cege%2C+erhe.ob%2C+lmc%2C+supg%2C+ppco%2C+pphm&t=6m&l=off&z=l&q=c&p=v&a=m26-12-9%2Cp12%2Cfs%2Cw14&c==.
The due diligence that I do (as a minimum) on trading stocks is to look at insider trading activity, the balance sheet, mutual fund/institutional ownership, scan the news/maybe read some, check I Watch, make sure that they're probably in a Cyclical Bull Market (should have completed a 9-18 month Cyclical Bear Market in the past year or two), etc. I didn't see anything with any of the stocks listed in this post that scared me away, and, ERHE.OB as of the end of last year had over $38 million in cash, which is great for an OTC Bulletin Board stock.
Rockets that appear to be very close to monthly cycle lows are NGEN and PPHM. CEGE could bottom on Monday or Tuesday at 4ish, after filling it's downside gap at 4.31. ERHE and PPCO are in Wave 1 short term upcycles or could be early in Wave 2 down of monthly upcycles.
If one decides to trade rockets obviously paper trade for a while or trade very modest positions at first.
There are times when one should wait for strength after hitting a price target (hit a buy signal), such as if there's a well established downtrend line one should wait for it to clearly be broken (might wait for a Wave 1 short term upcycle and buy late in a Wave 2 down or early in a Wave 3 up, in the flat early part of the cycle), and, there are times to consider trying to catch the bottom (when I Watch and the WMT Lead Indicator are clearly bullish and/or a stock bounces at a well established uptrend line, then look to buy a pullback).
I'll be using cycle trendlines/channels, Elliott Wave patterns, gaps, the WMT Lead Indicator, I Watch, etc. to time the rockets. If it works the way I think it will it should be a lot of fun. We'll see.
As a long term multi-year investor in any stock, commodity, etc. you want to buy near the primary multi-year Secular Bull Market/very long term upcycle trendline, for example NEM's is at 40ish right now, see chart 8 at http://www.joefrocks.com/GoldStockCharts.html. Therefore, NEM right now would be a great buy in the 40-42 range. Gold's primary multi-year Secular Bull Market/very long term upcycle trendline is at $470ish right now, so, gold would be a great buy in the $470-500 range. When the vast majority of gold writers say it's a great time to buy or are bullish, as they almost always are, it's rarely a good time for long term investors to buy.
HUI/XAU's Wave 2 Cyclical Bear Market began 5-11-06, see charts 7 and 9 at http://www.joefrocks.com/GoldStockCharts.html. NEM's Wave 2 Cyclical Bear Market that began on 1-31-06 ended on 10-4-06 at 39.84, so, reliable lead indicator NEM is probably in a 5-6 yearish Wave 3 Cyclical Bull Market since 10-4-06, see chart 8 at http://www.joefrocks.com/GoldStockCharts.html. ....... http://www.JoeFRocks.com/ .
HUI NEM XAU
Labels: Gold, Gold Stocks, HUI, NEM, Silver, Silver Stocks, SPX, XAU
posted by Joe Ferrazzano at
10:06 AM
