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Registered User
Joined: 12/26/2004
Posts: 4
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Post has been edited by moderator.
From mid October to today, INTC looks to be setting up almost a picture perfect pennant.
Also, after the long downtrend of 2004, MACD is divergent from the June high compared to the November high.
I've been out of investing for a while and am a bit rusty on my analysis. Please comment to help me re-tune my skills after my 3 year hibernation.
Thanks,
Dave
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Registered User
Joined: 10/17/2004
Posts: 43
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Well - I don't claim to be a chart wizard and would have to admit to some fairly strong negative bias about INTC on the long-term fundamental side - but that said I'll venture a comment. I don't see the near picture perfect pennant. I see an initial rally off a double bottom in Sept-Oct that peaked near 25 then pulled back and the next attempt failed in early Dec in a strong market. Since then I see a descending triangle with negatively divergenct MS and poor TSV on the daily (I use TSV18)ending with an outside reversal day today on increased volume (although still not extremely high vol) - that also occurred right below the still descending 200D MA. Finally on the weekly it looks like this whole pattern was a failed breakout of the downtrend line with very negative MS over the entire year.
All that said I'll reiterate that I think INTC's long-term picture is not robust and that may well be coloring my view. But at least now you know what someone on the other side of your trade might be thinking.
take care
gc
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Registered User
Joined: 12/26/2004
Posts: 4
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QUOTE (gasminder)
All that said I'll reiterate that I think INTC's long-term picture is not robust and that may well be coloring my view. But at least now you know what someone on the other side of your trade might be thinking.
GC,
Thanks for the analysis. I really appreciate various opinions and will use the stocks future performance to help tune my skills.
Thanks again,
Dave
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 Gold Customer
Joined: 12/7/2004
Posts: 10
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When I look at INTC on a weekly, I see this: I pull a trend line from the highs of Jan. 04 down to the Nov. and Dec. highs. If you next pull a trend line across bottoms of the up move, you’ll notice price has taken out the long term down trend and came back to test it. Now if you draw one more trend line down from the Nov. high to the present, you’ll see the pennant you speak of. This will give a better view of things to come because it’s from the weekly chart. It may also help to know that price has touched the .618 % retracement line.
Hope this helps.
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Registered User
Joined: 10/17/2004
Posts: 43
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QUOTE (leebcg) When I look at INTC on a weekly, I see this: I pull a trend line from the highs of Jan. 04 down to the Nov. and Dec. highs. If you next pull a trend line across bottoms of the up move, you’ll notice price has taken out the long term down trend and came back to test it. Now if you draw one more trend line down from the Nov. high to the present, you’ll see the pennant you speak of. This will give a better view of things to come because it’s from the weekly chart. It may also help to know that price has touched the .618 % retracement line.
Hope this helps.
Yes - I didn't mean I couldn't see the pennant (in fact two ways to draw one) but rather I didn't think that's the way to interpret it. Long story short I don't think pennants are a priori bullish or bearish - the breakouts can go either way and I use the indicators to determine which way to be ready for (and still don't trade until confirmed). In this case I thought the indicators (TSV, MS, BOP) are more suggestive of a break to the downside especially after yesterdays move above the downtrend line then reversal back into the pattern to form an outside reversal day on higher volume. Todays break below the lower trendline on higher vol yet (and now well above avg) adds fuel to the fire in my opinion. I think it's getting very close to being a potential short with a target being a test of the Sept. low. (BTW the rally off the Sept low topped at a 0.38 retracement of the fall from the Jan high... gotta love those ratios)
I'd also point out that the market is looking very weak and the semi's in particular. INTC's main competition is AMD who was much stronger in the last rally but now looks weak as well (see todays worden notes on AMD & SMH). Just my opinion which is worth exactly what you had to pay for it............... 
good trading
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Registered User
Joined: 12/26/2004
Posts: 4
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I guess I need to learn more about TSV, MS and BOP. My prior trading experience was with QCharts which did not have these apparently powerful indicators. Today I saw several bullish stocks to the panic sell off so I'm not sure if the pennant was incorrect or the general market conditions took out the bullish INTC move.
As a side note...A while ago, I read a trading rule (I think it was Ken Trester) to always have an balanced portfolio go long on bullish stocks and short on weak stocks. This really helps even out the sudden market turns like yesterday and today. I am thrilled that I had bought a few puts on December 31 on a few other weak stocks.
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Registered User
Joined: 10/17/2004
Posts: 43
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I think the three proprietary indicators are about the best thing in TC2K (plus speed in charting and sorting). I find them much more useful predictors of how price patterns are likely to resolve than the plethora of commonly used indicators (stochs, RSI, MACD etc). They are also fairly easy to use - my take on them is:
TSV - much like OBV but an oscillator so it gives clearer signals and seems to be a little more likely to give early divergences than OBV
MS - just look for general slope versus price, the one I find most predictive if it's significantly diverging from price.
BOP - be careful, lots of time it's meaningless but there is one pattern I find VERY powerful. When BOP is strongly contradicting a move while it is in progress that's a great sign of a coming turn. (that may not be clear - what I mean is if you have a rally going on but BOP is red and getting more negative as the rally progresses that's a great sign to be ready for the rally to fail; the converse is true on drops, if BOP is green and getting stronger even as the drop accelerates you're likely approaching a bottom). But when BOP is tracking moves it's really not telling you much.
I like these indicators because they incorporate volume behavior strongly rather than just being a rehash of past price action - I believe that makes them much more useful as predictors of the PROBABILITY of coming price action. Of course that may be because of how I use indicators - I don't like rigid "signals" systems (buy the crossover etc) but prefer to find patterns that suggest low-risk entries in conjunction with strong indications from these 3 indicators of a likely direction of resolution.
good trading
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Registered User
Joined: 12/12/2004
Posts: 8
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Hello - I'm a new user and just started reading other members comments on the market. Wow, its great to be able to gain insight and get some mysteries solved by reading comments from seasoned traders. I am very interested in learning how to read the charts and understand the signifance of TSV, MS and BOP. So, it was great to find gasminder's 1-05-05 comments on when BOP is a meaningful indicator and when it is not. I'll be on the lookout for BOP contradicting an upward or downward trend. Thanks for the specificity of these posts. It's a great help.
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Worden Trainer
Joined: 10/1/2004
Posts: 4,308
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You may be interested in viewing Peter Worden's video series on the Wordens' three proprietary indicators: Balance of Power (BOP), TIme Segmented Volume (TSV), and MoneyStream. They are the single best source for information concerning how to interpret these powerful indicators. You can learn more about them, or even purchase them, by clicking on this link:
http://www.worden.com/XMLPage.aspx?xmlpage=videopage
The videos are reasonably priced, and they come with a full one year money-back guarantee...so you can't lose.
Glad you're learning a lot from reading the various posts here in the discussion forums. It's gratifying to see quality input from the people who have been visiting and participating in the boards. I hope you enjoy using TeleChart, and that you'll visit the discussion forums often. If you ever have a question about the program, don't hesitate to post it in the Ask a Trainer forum.
- Doug
Teaching Online!
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