The fast stochastic signal was confirmed by Person's Proprietary signal (pps). The parabolic sar and the macd have been in bear phase since early August.
LCC has been trading in a range since mid-May, between $8 and a bit shy of $11.50. The pattern could be seen as an emerging double top, or even a sketchy head and shoulders.
On the Person's chart, two days of declines brought the stock almost to the lower weekly pivot, a level from which it has rebounded.
|pps||pps open||upper pivot||lower pivot|
|LCC $8.95||$9.11 aug20||$9.71 +8.5%||$8.70 -2.8%|
Price support and reistance levels give room for movement either way -- 10% to the downside and 27% to the upside. Since we're talking bear phase, the relative risk-reward comparison looks a bit shaky already.
The downside risk depends upon whether we're looking at a continuing sideways trend -- that's the 10% -- or a true downtrend.
LCC hit bottom in July 2008 at a pathetic $1.45, bounced up, retreated, and since March 2009 has been on an upslope.
So despite having been hammered in ancient days, and the despite the inherent risks of a crowded, high-overhead market like airlines, this is essentially an uptrending stock over the mid-term.
A bear signal must count as counter trend.
- $11.40, +27.4% (swing high)
- $9.87, +10.3% (20-day moving average)
- $8.95 <== You are here.
- $8.05, -10.1% (swing low)
- $5.70, -36.3% (earlier low)
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.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
- 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.
- sto zone: green for bull phase, red for bear phase.