RAD Watch

The pharmacy chain Rite Aid Corp. (RAD) has moved into bull phase on the macd, with the signal's fast moving average crossing above the slow moving average to add punch to the bullishness.

	trend	adx	psar	pps	macd	macd trend	sto	sto trend
RAD $1.17

At 12:38 p.m. Eastern


The price, however, has fallen intra-day for a fourth straight trading day. All four days have been within an identical range, $1.14 to $1.22. In other words, despite all the signals and movement, RAD has gone nowhere.

More broadly, RAD is recovering, however slightly, from a decline that took it from $1.77 on March 25 down to $1.04 on May 21.

I say "however slightly", but in the world of penny stocks, there is no slightly. Slightliness is no where to be seen on the unglightly scene, as illustrated by the fact that the trading range of the last four days covers a 6.6% intra-day decline, high to low.

That's why penny stocks rock (if you're on the right side of price movement).

Looking more broadly, RAD has been in an unrelenting downtrend, from $6.74 in April 2007 down to 20¢ in February 2009, and then sideways between $1 and $2 (with one breakout) thereafter.

Reversal Levels

• $1.49, +27.4%
• $1.38, +18.0%
• $1.22, +4.3%
• $1.17 <== You are here.
• $1.14, -2.6%
• $1.05, -10.3%

RAD is a short-term play, perhaps even a daytrade, given its volatility. In the longer term, I'm bearish on the stock. As an actively managed position, I see money to be made on the bull side, at least for the next week or so.

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Abbreviations:

• psar - Parabolic Stop and Reverse
• adx - Average Directional Index
• pps - Person's Proprietary Signal
• ma20 - 20-day moving average
• macd - Moving Average Convergence-Divergence
• sto - Fast Stochastic

About the glance: The colors indicate the state of each signal.

• trend: Determined by the 5-day moving average, green for up, red for down, yellow for sideways
• adx: orange for above 30-up, blue for 20-down, purple for in the middle. Red is most prone to whipsaws
• psar, pps, macd: green for bull mode, red for bear
• sto: green for overbought, red for oversold, yellow for the neutral zone.

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Tim Bovee, Private Trader tracks the trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment. No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.