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Waiting for breakout on a monthly closing basis of SPX to establish a position in this stock which I think is undervalued and pays a nice dividend. However, if SPX can't make a new all-time high on a monthly closing basis then I think the stock market in general will have a pullback into the presidential election where I could maybe get in this stock at a little bit of a discount from today's price. Even if SPX breaks out this month and reverses (which very well could happen), shouldn't hurt too much..
Comment:
Bought yesterday just under $30. I have a tight stop loss but not an open order, instead going on a monthly closing basis so it's more risky but also won't necessarily get stopped out by a head fake - my stop loss is a monthly close below the long-term uptrend support line (which as of August 2020 would be a monthly close below $29).
Comment:
Price is really looking like it wants to break down but I'm still in for now... (Previous times that price got near the uptrend line it didn't spend much time there, unlike this time where it's just barely staying above it.) Depending on how fast it drops if it breaks down I might not be able to get out since my stop loss is on a daily closing basis. I may consider just adding to my position depending on how far and fast it drops (if that happens). I know this company has paid out a lot in dividends over the past decade, but price is currently only about 23% above the '08-'09 lows. If price were to breakdown, I wouldn't expect it to go too far, maybe $24 to potentially as low as $20 and I would expect strong support if it got that low because that would be the lows it put in after the tech bubble crash and also just below the lows it put in at the height of the "great recession".
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Unless price can recover above the trend line today, I will take the signal and get out with a minimal loss as I think price could fall further in the coming months. I would look for re-entry around $24 (if price gets there), price could also fall as low as $20 but I don't see it going further than that, which I've alluded to above. (Anything could happen but I would expect strong support at those levels.) Just my thoughts and notes about what I'm doing and I'm by no means an expert, therefore trade at your own risk.
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Looking to re-enter if price can make a monthly close back above the trend line, appears it may have been just a fake out but I thought the monthly closing breakdown was more definitive and decided to get out to avoid a collapse and potentially get back in at lower prices. Anyway, little damage done and I can potentially get back in near where I sold out as this stock doesn't tend to move much each month, but waiting until end of the month to decide on a more clear signal. Also, please refer to recent post by AidanMDang, I like his chart better as well as his thoughts about why this stock can make a rise to the top of the pattern he indicated.
Comment:
This is a classic example of why I wait for a monthly close. I will continue to wait until price can make a monthly close back above the trendline to get back in, but hopefully there will be a shakeout and I can get in at lower prices. Anyway, I will let the market tell me what to do because I have no idea what will happen.
Comment:
Updated chart (below). Blue uptrend line is the line I set that is based on monthly closing basis price. The white uptrend line below it is based on ultimate lows it hit mid-months. It really feels like they (whoever they is) want to break this down and buy more shares up cheap. I'm either waiting for that to happen so I can get in as well or I'm waiting for a monthly close back above the blue line to give me a signal to get back in.
