: Mistake in the text on the chart, should be Looking for a "higher high and Higher low"
; It also has 2 gaps to fill, small but worthy point to take in account
Seeing TimWest's idea on the stock price today, felt to find a good entry point for the stock on the short term, while focusing on the long term prospects. On the weekly it does seem that at any point it is a good entry now as it is 50% down from the recent high, but it may be going lower if it follows the apparent channel .
As Tim Notes: "Tim: "I generally like to see TFM get "beaten up" and then I take another look at it and see if I can buy it in the bargain bin, where it is today, nearly 50% off of its highest levels in the last year."
Regarding the recent decline, Tim provided the following: "The decline from the highs is a function of it being horrifically overvalued by growth investors who were paying 2.5 times rational valuation levels based on monstrous growth. As growth estimates have been tempered and earnings have missed expectations, growth investors have rushed for the exits. This is the rotation we have seen in the market, out with growth and in with anything else (utilities, technology, semiconductors, oil, oil service, etc.) The profit margins have dropped and expectations are down. Note that sales have surged from 1B to 1.5%, or 50% in the past 3 years"
This does look like to be the case, but what bothers me is that the 2011 resistance at around 30 has been broken once already, even after one bounce. So for now a possible entry point would be at the low of the channel to at least stay within the channels trading, or on the breakout from the channel. So far we have seen a lower low, and would need a higher low to enter. At this point i see it will indeed be outside the channel if that is the case.
Note: MACD. RSI. Stoch, CCI are not good indicators on this one as the swings are too large while these indicators trade in their range
; It also has 2 gaps to fill, small but worthy point to take in account
Seeing TimWest's idea on the stock price today, felt to find a good entry point for the stock on the short term, while focusing on the long term prospects. On the weekly it does seem that at any point it is a good entry now as it is 50% down from the recent high, but it may be going lower if it follows the apparent channel .
As Tim Notes: "Tim: "I generally like to see TFM get "beaten up" and then I take another look at it and see if I can buy it in the bargain bin, where it is today, nearly 50% off of its highest levels in the last year."
Regarding the recent decline, Tim provided the following: "The decline from the highs is a function of it being horrifically overvalued by growth investors who were paying 2.5 times rational valuation levels based on monstrous growth. As growth estimates have been tempered and earnings have missed expectations, growth investors have rushed for the exits. This is the rotation we have seen in the market, out with growth and in with anything else (utilities, technology, semiconductors, oil, oil service, etc.) The profit margins have dropped and expectations are down. Note that sales have surged from 1B to 1.5%, or 50% in the past 3 years"
This does look like to be the case, but what bothers me is that the 2011 resistance at around 30 has been broken once already, even after one bounce. So for now a possible entry point would be at the low of the channel to at least stay within the channels trading, or on the breakout from the channel. So far we have seen a lower low, and would need a higher low to enter. At this point i see it will indeed be outside the channel if that is the case.
Note: MACD. RSI. Stoch, CCI are not good indicators on this one as the swings are too large while these indicators trade in their range
