As my other coins seem to be recovering nicely from the market correction, Neo has become a laggard. I wrote yesterday that when everyone is calling for a pullback,and most are negative on the market, this is generally the signaling point we have hit bottom. So we take this as an opportunity to trim off the fat in our wallets and adjust our holdings for the future Bull. Market corrections separate the great coins from the bad, future superstars from bad draft picks. Bear markets are the preseason for Bull markets, and while most of our coins are doing great in preseason, Neo appears to be struggling. And the commentators are speaking up so let's check the news.
I read quite a few blogs and articles last night and many of them were negative on Neo, lack of developers, issues in China, not enough applications, not as far developed as eth was at this point, etc. Ok the commentators are telling me to trade neo he is not performing. There are a lot of better free agents out there right? So I woke up after reading this news with an open mind and a cup of coffee, I do not just cut players based on commentators, I'm the coach. This is my team, I need to review the tapes and assess the player myself.
Looking at the charts I do not see all the doom and gloom (yes a few dropped passes but everyone has a bad game). I take a look at my Bull/Bear indicator, and Neo has entered Bear territory. But does that mean we should cut? (we have a lot invested in this player). Markets like athletes go through cycles so we must determine is this a cycle or was this a one year superstar. Let's take a look at a longer time frame and compare (vs the dollar). Well a recent 50% pullback is not great, but that hardly tells the story. The dip looks minimal over a 1 year period and would be typical after an impulsive buying cycle, over a span of just a few weeks. Heck it was at 50 cents in May, $45+ in August, and $22 now. By no stretch of the mind is this unreasonable! We don't cut a player that leaded the league in touchdowns last year, because of a few preseason drops do we? Let's zoom in.
Looking at the Linear Regression channel we are still in an uptrend since the correction. I also drew a trend channel, as an overlay, and it's formed a slightly higher uptrend, this is good. I also noticed we have formed several descending triangles leading up to and after the last correction. The past three triangles resulted in a correction. (The one after the correction, appears to be an impulse trade and the gradual decline tells us selling is becoming weaker. This is a good sign!) But the current triangle neo did something different, it broke to the upside, and has now found support on the down leg of the triangle. This is a change from the past three triangles. This was right at the bottom of our trend channel. The lows are trending higher (another good sign). This is improvement. I also noticed higher lows in the rsi since the major correction and though we are testing the bear level we are slowly finding strength and more importantly stability. (Note vs the dollar the rsi formed a double bottom often signaling a bottom and possible reversal.). I still want to see neo form a "higher high" above the impulse move, but it's not all the doom and gloom one would expect.
So overall though the news and blogs is painting an ugly picture, the market appears to be telling us something different. This is the point many give up and sell, right at the bottom. I thought about it did you?
I'm not saying buy here, (though I may do a little bear skin trading), but I'm still not selling. How many times, have coaches traded players to wish they didn't afterwards? Neo may be that player we do not want to trade. With that said If we break the channel, we will have to take another look. Monitor closely as Neo is still in the doghouse but showing positive signs of it's former self. I'm not sure it's time to cut last year's star player, yet!
I read quite a few blogs and articles last night and many of them were negative on Neo, lack of developers, issues in China, not enough applications, not as far developed as eth was at this point, etc. Ok the commentators are telling me to trade neo he is not performing. There are a lot of better free agents out there right? So I woke up after reading this news with an open mind and a cup of coffee, I do not just cut players based on commentators, I'm the coach. This is my team, I need to review the tapes and assess the player myself.
Looking at the charts I do not see all the doom and gloom (yes a few dropped passes but everyone has a bad game). I take a look at my Bull/Bear indicator, and Neo has entered Bear territory. But does that mean we should cut? (we have a lot invested in this player). Markets like athletes go through cycles so we must determine is this a cycle or was this a one year superstar. Let's take a look at a longer time frame and compare (vs the dollar). Well a recent 50% pullback is not great, but that hardly tells the story. The dip looks minimal over a 1 year period and would be typical after an impulsive buying cycle, over a span of just a few weeks. Heck it was at 50 cents in May, $45+ in August, and $22 now. By no stretch of the mind is this unreasonable! We don't cut a player that leaded the league in touchdowns last year, because of a few preseason drops do we? Let's zoom in.
Looking at the Linear Regression channel we are still in an uptrend since the correction. I also drew a trend channel, as an overlay, and it's formed a slightly higher uptrend, this is good. I also noticed we have formed several descending triangles leading up to and after the last correction. The past three triangles resulted in a correction. (The one after the correction, appears to be an impulse trade and the gradual decline tells us selling is becoming weaker. This is a good sign!) But the current triangle neo did something different, it broke to the upside, and has now found support on the down leg of the triangle. This is a change from the past three triangles. This was right at the bottom of our trend channel. The lows are trending higher (another good sign). This is improvement. I also noticed higher lows in the rsi since the major correction and though we are testing the bear level we are slowly finding strength and more importantly stability. (Note vs the dollar the rsi formed a double bottom often signaling a bottom and possible reversal.). I still want to see neo form a "higher high" above the impulse move, but it's not all the doom and gloom one would expect.
So overall though the news and blogs is painting an ugly picture, the market appears to be telling us something different. This is the point many give up and sell, right at the bottom. I thought about it did you?
I'm not saying buy here, (though I may do a little bear skin trading), but I'm still not selling. How many times, have coaches traded players to wish they didn't afterwards? Neo may be that player we do not want to trade. With that said If we break the channel, we will have to take another look. Monitor closely as Neo is still in the doghouse but showing positive signs of it's former self. I'm not sure it's time to cut last year's star player, yet!