Registered User
Joined: 12/2/2004
Posts: 1,775
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I have tried over several hours to reply to your post below but every time I am denied ability to post in that thread, so here's the reply, hope this works:
Griz, excellent question on base stage for DAR. Sometimes I find it hard to figure out just what stage base a stock is in, so when that happens I like to rely on my good friends the 50 and 200-day moving avgs. Rule of thumb that I use is that a stock is not extended until price is at least 50% above the 50-day, which would be about 19.70 for DAR. If all goes well I plan to lighten up 1/3 of the position around 19-20 and place loosened trailing stops on the remainder....never know how far a stock will run. What's the old saying? The trend is your friend until the end:)
Back to its chart it looks like DAR's base may have been reset to a count of one on the Aug. 07 lows? You think that Aug. low undercut a legit base or two above it at that time? Since then it looks like a base on a base on a base, lol. Just trending right up along the 50-day more or less. I know I read one time where Mr. O'Neil stated that the first base doens't really start until price gets into the double digits, institutional volume picks up. DAR is just recently trading on the NYSE, was an AMEX stock before that, so higher visibility now I guess. I'll just let price rule for now....and sell when I get signals, good or bad.
KOP looking good. I had played it months earlier...pretty sure I got shaken out with a loss. BDE, been watching it for a while, too extended now, but I bought one in its same group I think, SD, two weeks ago and it's doing well but is stalled now in relative tight range. Later.
Pete
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Registered User
Joined: 7/28/2007
Posts: 118
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I think I found the "rule" that O'neil uses for base counts.
IBD says there are two ways to tell if the base count has been reset; if a base undercuts the prior base the base count has reset. If the market goes into correction mode, then the base count resets. If we had what qualifies as enough of a correction in January, then I guess DAR would be in a stage 2 breakout. Either way I like your idea of using the 50 and 200 dma for guidance. Looks like you're doing very well with DAR. Good luck!
Back to OTEX----Volume on the down side was just average today so I am holding right now for about a 3% loss. I was going to enter a sell at market order for tomorrow morning, but I noticed that the price seemed to be supported later in the day by some big block trades, note the heavy green BOP. I may be making a mistake here, we'll see.
Griz
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