Charts Make Money, Talking Heads Get Slaughtered, $GTAT

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Shares of GT             Advanced             Technologies Inc (NASDAQ:GTAT) got crushed on the news that the company filed for Bankruptcy on Monday. If you are one of the many unfortunate CNBC viewers who blindly followed the advice of the talking heads and bought shares of GT             Advanced             Technologies Inc (NASDAQ:GTAT), clearly you are not in a good position. It is never fun to watch a stock you own collapse in such fashion. Shares of GT             Advanced             Technologies Inc (NASDAQ:GTAT) ended the session down by 92.76%

As I heard the news, I quickly took a look at the daily chart of GT             Advanced             Technologies Inc (NASDAQ:GTAT). As expected, the chart of GT             Advanced             Technologies Inc (NASDAQ:GTAT) was a screaming short (not something any knowledgeable trader/investor would buy) and clearly no member of would have ever been caught holding on the long side.

Stock patterns and the trend for any given equity is something every investor/trader should learn and understand before entering any kind of trade. Whether it is a long or short term investment, the chart and news for GT             Advanced             Technologies Inc (NASDAQ:GTAT) is a perfect example of this. As you can see in the chart below, GT             Advanced             Technologies Inc (NASDAQ:GTAT) had a clear trend line break down on September, 10th (as highlighted by the white oval). This pattern is something that is taught to every member who takes the Methodology Revealed Webinar and it is invaluable to trading. There were many factors suggesting that this equity would drop a significant amount. Among others, please note how this particular stock was trading below the 20, 50 and 200 moving averages; a clear sign of a downtrend and a weak technical position. This is the first warning sign not only for shares of GT             Advanced             Technologies Inc (NASDAQ:GTAT) but for any equity. On September 15th, the stock confirmed below the red trend line , signaling that a collapse was imminent. As the 20 day moving average came into price (yellow line) shares of GT             Advanced             Technologies Inc (NASDAQ:GTAT) received the final spark needed for a massive drop. Stock charts never tell us what the catalyst will be, but they enable us to position ourselves on the right side of the trade, with a high rate of success when read correctly.

This is yet another perfect example of how following the advice of any news, media or talking head on CNBC is like throwing money out of the window. Trading without any knowledge of the technicals behind the stock you are considering can and will lead you to loose money, time after time. Do not allow this to happen to you. Learn the technicals, be disciplined, and always follow the charts. This will not only help you to stay away from buying shares of companies such as GT             Advanced             Technologies Inc (NASDAQ:GTAT) at the completely wrong time like the talking heads told you to. The charts will alert you of the best time to enter or exit any given trade with a high rate of success.
Would've been a good short on the break of $14.00 did not see the chart at the time. However, good to see technicals at work. For educational purposes.
"Unfortunately, I have not found a broker that let's me place orders in the middle of the chart" - Alexander Elder
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