Helping A Fellow Investor

First & foremost I appreciate simplicity.  I appreciate cleanliness.  I appreciate methods that work on a regular basis.  I understand that no method is pristine and most methods require some finesse.  The chart below shows an example of that finesse. 

Back in late 2010, ITUB began the downtrend that has lasted for 3 years now.  If you are investing in this stock you have to realize that the highs and lows are getting lower as time goes by.  The easy way to play this stock it to go short.  If you are going long, you are trying to make money the hard way.  Not that it can't be done but it will take longer and it will work less often. 

Look at how quickly this stock drops.  Look at the drops in July of 2011, April of 2012, and June of 2013.   Also look at the long red downtrend lines.  It makes sense that if a stock is in a downtrend, it will fall faster than it will rise. 

This is a Weekly chart of ITUB 

ITUB hit a high above the lower red downtrend line.  So I drew another downtrend line that starts back in November of 2010 and hits this new top.  This is the finesse I spoke of earlier.  But let's face it.  The 3 year old pattern continues as expected.  I drew a green uptrend line to show the last uptrend and where the price crosses below it.  I also drew a new red downtrend line.  The length of the line is arbitrary.  I have no idea how long the downtrend will last.  The angle of the line seems to be accurate though.  Time will tell.  I may need a bit more finesse along the way. 

I will say that I notice something I didn't put on the chart.  It has to do with the lows from mid 2012 and mid 2013.  Do you notice that these lows are close to the same level?  This may be a sign that $11.50ish is a level of support.

Now let's look at BBD.  Almost everything I said about ITUB holds for this chart too.  What are the differences?  Well I haven't needed any finesse yet.  And I am not willing to say that I see a level of support yet.  Here is a coincidence I just noticed.  It looks like the downtrend in both of these stocks started at almost the same time. 

This is a Weekly chart of BBD

I prepared one more chart to try to help you out.  That chart is of PANW.   This is a newer issue and therefor we have less history to go by.  That typically means there is a lot more finesse required. 

I noted the Day 1 high & low on the chart.  These are "mentally" important levels for an IPO.  You have to respect them.  I also drew a red downtrend line that started in September 2012.  The only other line on the chart is a green uptrend line that is much more of a horizontal support line in my mind.  I think this green line may show a double bottom that could lead to a change in trend. 

Friday's candle pierced the red downtrend line with greater than average volume.  It also closed above the red downtrend line.  If you want to go long this stock you may have good reason to do so.  Keep watching and let the story unfold. 

This is a Daily chart of PANW

Sorry this chart is so small but I can't get Blogger to let me change it's size.

You can click on it for a larger pic.

If there is any way I can help my fellow investor I am ready (as long as time permits).  I don't claim to be anything more than an investor who uses trend lines.  I am not the best investor out there.  I am not the most knowledgeable investor out there.  But I am someone who isn't afraid to spend some time helping out a total stranger.  I hope this post helps you. 

Buffalo Wild Wings (BWLD)

Buffalo Wild Wings has been cruisin' lately.  If you are looking for a good time to jump in, one may be coming up in the very near future. 

 

This is a Daily chart of BWLD

About a month ago, when BWLD announced earnings, would have been a good time to buy some shares.  It has gone from about $137 (after earnings) to $150ish where it is now.  In the process of getting up to 150ish it has created a well defined triangle.  The top of the triangle and the hypotenuse of the triangle are your guides for a new investment should you want to make one.

If you invest (long) here, don't let the price drop below the hypotenuse of the triangle.  If it drops below intraday then you can decide if you want to see where it closes.  If it closes below then going long may not have been the best decision.  Set your stop just below the green uptrend line.  I would say 145 to 148 is a good place to put your stop.  The uptrend line is currently at 148ish.  Remember that setting a stop is like you saying, "I am willing to throw $X.00 out the window if this doesn't work."  Investing is risky.  But you have to limit that risk so it's tolerable.

Once the price closes above the top of the triangle, you want to look for confirmation.  You want the next day or two to stay above the top of the triangle.  A close back below won't be a great sign if you are long. 

Monitor & adjust your stop.  The plan here is that the price will go above the top of the triangle and continue higher once that happens.  If you put your initial stop in at $146.50 to protect your initial investment just in case the plan didn't work out, then move it up to say 150ish or "your break even" once the plan comes to fruition.  Then move your stop even higher once the price has extended.

Protect your profits.  If this plan goes off the way I hope it will you could see a price increase of 3-10% in a relatively short time.  If you find your investment is up 3-5% in a month you should take some profits.  How?  Sell some shares.  Maybe sell 20% of your initial investment and let the other 80% run for a while.  As long as it follows the uptrend line just sit tight and watch it grow.  Eventually you will want to take even more profits. 

Base your investment decisions on the chart.  Trade (invest) what you see.  Not what you think, or feel, or hope, or ...    
Limit Risk & Protect Your Profits.