Tuesday, November 16, 2010

A Couple More Trades...

DTV (short) looks like a breakaway gap. It has broken free of a nice looking bear flag. If the gap is not filled it's a very bearish gap. If it is filled, it may still offer an opportunity to get in at a lower risk level. I would think a reasonable stop would be back in the bearflag around $42.50+. The immediate pattern's measuring implications imply an initial target of $39. Of course at that point, other significant technical damage will have been done and the outlook would turn more bearish.
 DTV daily 3C negative divergence

DTV BearFlag (bearish continuation pattern) breaking down. Also a MACD negative divergence and big volume on the flag-pole breakdown

LPX (short) looks to be a false breakout. From false breakouts, come big moves in the opposite direction due to the dynamics of for lack of a better word, the losses mounting in a snowball effect. This may also be a breakaway gap, depending on whether it is filled. 3C daily looks like it was a false breakout as the daily divergence is very negative on the breakout. A stop above $8.41 would give the position some room in case it does bounce.
 LPX daily 3C chart, breakdown/negative divergence on the breakout. False breakouts tend to lead to big/fast moves in the opposite direction.

LPX Daily chart showing the false breakout and the possible breakaway gap.

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