Sunday, February 22, 2009

Tale of 3 Stocks







Take a look at the charts for these 3 stocks. You will see similar patterns. All reversal patterns. The 1st set of charts uses an arithmetic or linear scale, the second shows a geometric scale, this highlights the difference between number of points and percentages.

BAC - 1st, the top line shows higher lows signifying declining downside momentum. The bottom line echoes this. 2nd, the price shows a series of 3 lows in the last month with the last 2 displaying clear reversal pattern, last Friday's reversal is the clearest with volume almost triple normal levels! Bounce to 6+ possible.

C - This one is not as nice. Don't buy this one. But probably good enough for a bounce to 3.5

WFC - After hitting a low of 8.81, it closed in the upper fourth of its range on volume 4x normal. WOW! Looking for 16.

I see a bounce for all of these. It may only last 2 days, it may last 20 days. Who knows? (I'm betting closer to 2.)

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