Please see chart hopefully attached
below. Nice paraboic top at 40 is followed by approx. 13 dollar drop to
circa 27.
Elliott Wave says consolidations are
continuation patterns. In orther words, since the market dropped before
the consolidation, the resolution should be to the down side. If the first drop
of 13 was Wave I, then CHK is now in
Wave II consolidation. Wave III
should be the longest and strongest move, typically about 1.618 times Wave
I.
Wave I = 13 x 1.618 = 21, so subtract 21
from beginning of Wave III, which could project to the 14 – 10 area.
10 is was the top of the 2001 Wave I on
the upside, which should be major support.
Bottomline, if you are making
money trading CHK from the long side, it is because it is currently stuck in a
Wave II consolidation. I don’t know how long it will be in Wave II,
but this is a ticking time bomb, which when it goes off, this stock is probably
headed much lower. You will know its headed much lower if it breaks thru
the 24 area, which was the top of Wave III on the upside. You can’t
have overlapping waves on a primary trend. Violating the 24 area would
give overlapping waves and one more indication that the primary trend is
down.
Enjoy the trading range with
one hand on the rip cord and a plan to reverse to the short side.
Moral of this story:
Holding on to your natural gas too long can be dangerous.
Regards,
Norm
.
From: realtraders@xxxxxxxxxxxxxxx [mailto:realtraders@xxxxxxxxxxxxxxx]
On Behalf Of BobsKC
Sent:
Sunday, May 21, 2006 2:25 PM
To:
realtraders@xxxxxxxxxxxxxxx
Subject:
Re: [RT] post questions
Chesapeake
Energy... Both of you are depending on charts and I'm depending on
earnings. The stock has come down along with all the other natural gas
issues because the product has come down so far. Many do not seem to be
aware that they have sold 70% of the next two year's production at nearly twice
what the spot price is today. Throw in the CEO making a huge purchase in
the open market and the fundamentals can not be ignored. None of these
things take into account the approaching hurricane season and what will happen
to the cash price for natural gas once the first named storm moves into the
gulf. If those fundamentals are not enough, CHK currently sports an 8.4
PE It's been over $40 in the past 12 months and has a 10+% growth
pattern.
So now, we have two views by technicians and one by a fundamental trader.
All views are interesting and no one is always right or always wrong and
neither are styles of investing.
Good luck next week everyone,
Bob
At 10:27 PM 5/20/2006 -0700, you
wrote:
You see, Here is what I mean.
I
assume that this is Chessy Energy that you are talking about.
I have
price in a range between 34 and 25.50. It is in an up move until
25.50 is taken out and then this retracement has a target price of
26. Right now it is at support from a longer term move down at
28.75. You should get a retracement here and the retracement shouldn't
take out the 33 level. If 25.5 is taken out the next target to the
downside is 22.
This
current retracement up should meet resistance at 30 dollars and hit a target of
about 30.50. About a 1 point move from here. If long I would
exit there.
So you
would be 100% invested when I am exiting 100% and looking for a congestion area
or further down retracement before another up move would start.
We are
both looking at the same chart and seeing different things. Right now the
major move is down and anything to the upside is nothing to get excited
about. The upside is tradable and can be profitable. Like
everything else in life, what is seen is in the eyes of the beholder.
Once
again, just one man's opinion. Ira.
PS.
Finals on Monday and then a vacation. See all when I return. Have a
good week.
----- Original Message -----
From: Ben
To: realtraders@xxxxxxxxxxxxxxx
Sent:
Saturday, May 20, 2006 8:35 PM
Subject: Re: [RT] post questions
Hello Bob
I have attached a chart of the
perfect stop loss
the levels were I would buy would be
at a close above 29.27
will buy 25% of position with stop loss at 27.98
will add 25% to the position on a
close above 29.78
buy full 100% of position
at close above 30.68
sell 25% at profit at 31.10
sell another 25% at 31.89
sell rest at 32.36
or move stop loss to 31.1 with increasing that stop
loss every time the stock makes a higher hi
Ben
----- Original Message -----
From: BobsKC
To: realtraders@xxxxxxxxxxxxxxx
Sent:
Saturday, May 20, 2006 10:32 PM
Subject: Re: [RT] post questions
A kind and generous offer Ben.
It seems to me that traders try harder every year to
get ahead of historical swings and this time, it's the summer doldrums they are
trying to beat. So, instead of waiting for the dreaded summer months,
they are bailing now to beat the rush. The good news is even these swings
can be predicted if one just looks at the past performance of the markets
versus chronological changes and geo political events, etc. Whatever the
trend is, the traders will be trying to get ahead of that trend.
The fundamentals are still good. P E's are in
line and earnings are growing. Inflation is low and controlled.
Employment is strong
while on the negative side, housing is falling off and
some consumers are being pinched with ARM's. I was 100% cash until late
this week when I began buying again and will continue to buy as it falls.
To get your kicked off with your offer, here is one
for you. I already own CHK at $28.80 and will buy more if it dips below
that. The CEO recently bought a large block and they have sold 70% of
this year's and next year's production at $10 so as natural gas falls below $6
cash, it means little to CHK in terms of earnings. What do you think
about it?
Best to all,
Bob
At 03:19 PM
5/20/2006 -0400, you wrote:
hello
you are about to make a trade?
before making it
post it
get a second opinion
the answer will be posted with
charts to explain reasons why yes or no
Ben
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