Welcome. The contents of this blog comprise my personal observations on the stock market from the perspective of using both fundamental and technical analysis by reviewing market data and stock charts based on the methodologies of William O'Neil of Investors Business Daily and his books, from Stan Weinstein's books, and most of all, through lessons learned over the years by listening to Gary Kaltbaum's "Investor's Edge" radio show on Business Talk Radio.

Criteria of stocks include first researching sectors to determine which are strong and which are weak using the ADX indicator (>40 = increased volatility); focusing in on a leading sector and buying leading stocks on a high volume
breakout (minimum 2x average) above a base; stock prices are higher than $25/share with daily average volume higher than 300K; positive and increasing PVT (indicating institutional ownership), positive and increasing RSI (indicating relative strength compared to other stocks in the market).

Please keep in mind that
I am by no means an expert, nor are my posts intended for anything other than to share my opinions of what stocks are doing for the purpose of getting feedback. Thus, please do your own research before taking action on what you read here. I will be adding posts on topics of interest as I learn about them.

Thursday, June 26, 2008

CEO: Head & Shoulders top formation indicating a top.

Created when CEO was $168.87.

After a breakout on non-impressive volume from the wide trading channel from December 2007 - April 2008, CNOOC's stock formed a sloppy Head & Shoulders topping formation which is a bearish sign for the stock. The left shoulder was in late April, the head peaked around May 20th, and the right shoulder (lower than the left) was in early June. This should indicate that the stock is no longer in a bullish pattern.

All this being said, the stock trades with high volume days, and is one of the stronger stocks in the market (the RSI is high). Further, institutional investors are actively trading this stock (most recently, they've been selling it) and they are still invested in it which is a good signal.

All this being said, this is not a stock to short, but it is a stock that has posted a few warning signs that it is not one of the stocks to be investing in.

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