Friday, October 22, 2010

CMG Watch

When last we left Chipotle Mexican Grill Inc. (CMG), we were fretting over a bear signal, just hours before the fast food chain was due to release its earnings.

I find these to be the toughest of calls, because reason tugs one way and the signal another. In the end, I went with reason, and that gamble proved to be correct.

CMG produced a 21¢ earnings surprise (earnings per share: $1.52) and gapped appropriately to as high as 10.2% above yesterday's close.

CMG $197.12

The Heikin-Ashi candlesticks require two up-sticks in a row to establish a trend. There's one very long candlestick today, and I expect the trend to turn "officially" up on Monday.

On the Person's chart, using monthly pivots, the price blasted through the third upper pivot, the most the analysis software will allow.

Person's Table
ppspps openupper pivotlower pivot
CMG $197.22 $188.98 oct22 $193.71 -1.8% $177.79 -9.9%

CMG is trading at all-time highs, so there is no serious resistance. It is a blue-sky stock, my all-time favorite sort of bull play.

Reversal Levels
  • $199.20, +1.0% (all-time high)
  • $197.22 --- You are here.
  • $155.49, -21.2% (Dec. 2007 swing high)
  • $155.42, -21.2% (July 2010 swing high)
  • $127.30, -35.5% (recent swing 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.

  • h-a trend - Heikin-Ashi trend.
  • pps - Person's Proprietary Signal.
  • psar - Parabolic Stop and Reverse
  • ma20 - 20-day moving average
  • ma200 - 200-day moving average
  • macd - Moving Average Convergence-Divergence
  • sto - Fast Stochastic

About the glance: The colors indicate the state of each signal.
  • h-a trend: Determined by the Heikin-Ashi candlestick, green for up, red for down. Heikin-Ashi averages six days for high, low and close, signalling uptrend if the close is in the upper half of the range and downtrend if it is in the lower half.
  • sto: green for bull, red for bear.
  • sto zone: green for overbought (80+), red for oversold (20-), yellow for neutral zone
  • psar, pps, macd: green for bull mode, red for bear.
  • macd trend: green for rising, yellow for sideways, red for falling.
  • neutral.
  • ma20, ma200: green for above the average by more than 1%, red for below the average by more than 1%, yellow for within 1% either side of the average.

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