For bottom pickers and knife catchers

[eddyeagle]

Re: Bottom pickers and knife catchers

Great thread - interesting to read different people's opinions...

I agree that there are many stocks out there looking very very cheap but I also have a gut feeling that global markets are about to get smashed in the coming weeks / months. I dont think the pain is over yet...

Personally I think i'd wait to see a bit of an uptrend before buying in otherwise it can get ugly trying to catch that knife!

But it comes down to your investment timeframe and trading style.
Ie. ANZ at $17.50. A 5 year investor may do very well out of this. A one year investor not so well?

Also BMN doesnt really qualify does it because it has already bounced 75% off it's lows???

 

[uahmad]

Re: Bottom pickers and knife catchers

I might put my beginner 2 cents in.

To me TOLL Holdings (TOL) looks very cheap, its sitting around the $6 mark down from $14 from late last year.

Their fundementals from what i can see look great, obviously the oil price, market sentiment and VB is what keeping this stock down i think.
Surely the rise of oil prices will be passed onto the consumer sooner than later and once they offload VB this stock will rise fairly quickly.

Cheers

 

[Sean K]

Re: Bottom pickers and knife catchers

But if they know what they're doing then they use stop losses and sensible money management to ensure that losing trades doesn't seriously damage their trading account.

So traders picking a potential bottom can't do that either?

One thing that you have jumped the gun on here, is that there is no requirement to call a bottom before the fact. A better way is to wait for clear signals that the bottom may be in. In FA, that may be when a stock has gone well under NTA, or extremely cheap on IGV to MC, or Oz au to MC, or whatever. In TA, you can pick a potential bottom when a stock hits long term support, and bounces, breaks resistance, and then that resistance turns support.

BMN was mentioned earlier, and fit both FA and TA requirements for a potential bottom.

On this chart you will see the stock hit very strong long term support at $1.50. After going under a dragon fly doji flew in and was followed up by a very strong white candle. The stock tested $1.50 in about 4 occasions and it held. It then started making higher lows and highs.

4 May:

Not necessarily bull trap, looks like a nice higher low and high and that rejection of the low dragonfly in retrospect may be the bottom. Yes, this has happend 3-4 times since the double top and capitulation with the markets and Opies etc, but with the change in general market financial sentiment, I ´m plucking a bottom. That ´ll come back to bite me.

I don't like doing it myself, always fraught with danger, but if you see one, and set stops etc, it can be very profitable.

I think we're going to see a few bottoms in the coming months (years? )

(BMN will crash now, lol)

 

[So_Cynical]

Re: Bottom pickers and knife catchers

Bottom picking...Jezzz where do i start.

• TOL - Toll holdings Ltd
• PPX - Paperlinx Ltd
• FCL - Futuris corporation Ltd

There all big players in there industry's, in fact arguably market leaders...all
at around 5 year lows or more...all have fallen more than 50% from there tops
so must be closer to bottom than top.

Hows that for TA ...5 year charts below.

 

[Sean K]

Re: Bottom pickers and knife catchers

We need to be careful this doesn't turn into a ramping thread too, so keep the justifications flowing.


I'm calling a potential bottom on KMN, but wouldn't call a most likely one until some key resistance is taken out and another higher low is made. Breaking 30 and I will be more confident to do so. Doesn't mean it's going up though, just not down any more. Is also due to produce an upgraded JORC at one of it's projects soon and a Scoping Study on the other. MC to Oz au of under $10 an ounce, makes it about 1/3 below market fundamentally.

But as you can see WOOF!!!! Would have to dump it back under 17c.

Can't believe that H&S target was met!

(holding both BMN and KMN)

 

[Miner]

Re: Bottom pickers and knife catchers

Great thread

Can I add in Kennan's spreadsheet

ANZ 17.77 on 1 July
DIO .74 ON 1 jULY

Cheers

 

[Sean K]

Re: Bottom pickers and knife catchers

Bottom pickers, however, don't always live to fight another day. I have three friends who were wiped out by buying 'value' stocks, then adopting the HAH (hold and hope) approach while their stocks plunged to oblivion. I know of many other people who suffered the same fate.

And bunyip, you're assuming this is a hold and hope thread. It is not. You trade every stock on it's merits. I'm not sure why you've jumped to all these assumptions about trading oversold, undervalued stocks.

I must say I agree in buying into trends in general. That's why I don't buy downtrending stocks unless there's a high probablility of a bottom being in. That means some FA disconnect, some technical signals, and higher lows and highs. Also, no need to pick and obsolute bottom, but picking close to the bottom and start of an upward trend can be very rewarding. Like with breakouts. The closer you pick the break, the better. That's the point of the 'potential breakout' thread too. There's no buying and hoping here.

As for knife catching, I see this as picking things that have reacted extremely badly to some type of news and get way oversold on market fear. Plenty of examples of those recently.

Commiserations to your friends.

 

[Trop Beaucoup]

Re: Bottom pickers and knife catchers

Hi all,

What about INL, been hammered by price of zinc and further share issue- has some decent tech though..?

 

[Sean K]

Re: Bottom pickers and knife catchers

Hi all,

What about INL, been hammered by price of zinc and further share issue- has some decent tech though..?

It's at all time lows, but that's not necessarily a reason for it to stop going down. Should be some support, but found a bottom? Is Zn going to continue to slide, or has it found a bottom? Would like to see a single higher low and high before calling anything. Probably need some more detail on why it should be a bottom. Will include your nomination in the spreadsheet, Trop.

 

[enigmatic]

Re: Bottom pickers and knife catchers

Hey kennas, new to the FA game and even newer to TA.
think this is a great idea for a thread. Will be a good one for myself to follow just to get a better background on the development of FA and TA analysis.

I have one which i have been watching for a while, which i did actually think i found the bottom. What the market has recently done has however confused the matter.

FA Reasoning
In early 2007 this stock was re-rated based on its Nolan project with the following resources.
Rare earth:
The mixed bag or Rare earth are all priced per Kilo and range from $3.75 to $710. However Arafura have used quiet low PFS Assumptions based on the fast growth sector.
Chemical Catalysts 5%-10% growth per annum
Magnets 15% to 20%
Phosphorescence 15% 20%
There is also high demand for Renewable & Energy efficent products.
China is also becoming a Net Import of Rare earth.
Phosphoric Acid:
The Nolan project has a co-product of Phosphoric acid. which spot price has gone from 600 to 1800 per tonne in the last year. Arafura have used 400 in there PFS.
Calcium Chloride
This is a by-product of the Phosphoric Acid which priced at arround 250-350 a tonne. Nolan once again has used 100 in there PFS much lower then current Value.
Uranium
low quantity still provides 45mil possible revenue pa

Although i have a little more FA i think ill may move onto TA (little to no knowledge)

TA Reasoning:
I think this will be mixed with a bit of FA and a bit of Gibberish. hey we all cant be experts.
Forgive my chart below i have no software so its kinda basic.



As you can see on the Chart the red line is the 90day MVA and the Black the 240day MVA. you can also see the Blue and red lines of support. with the Recent recovery of the market you have seen the recovery of the share price 100%+ however this has pulled back majority of its previous gains to the support above long term. The main reason i believe this is the bottom is based on a the constant test of low support with amble buying. secondly my possible FA but not sure.

The main reason for the drop in share price i believe is consolidation and sell down of the 13c Options exercised by June 30th. now these are likely removed from the market and likely more Long termers holding. price is likely to rise see previous rise. (Much Lower remaining Options left)

Lastly from the 90day MVA you can see that it has steadied off as it Climbs back to the 240MVA i think it is looking like a much better buy on a TA point of view.

I'm sure I have got alot wrong here but I thought i give it a go. Kennas or anyone else some advice would be kindly appreciated.
Oh and can you put me down for ARU Kennas Bottom i think is 80c 6months and i think i have found bottom no falling Knife.

 

[Sean K]

Re: Bottom pickers and knife catchers

Hey kennas, new to the FA game and even newer to TA.

Oh and can you put me down for ARU Kennas Bottom i think is 80c 6months and i think i have found bottom no falling Knife.

Might be enigmatic. Worst case 70 ish perhaps. Breaking that and it's in a little trouble.

 

[enigmatic]

Re: Bottom pickers and knife catchers

Think ARU has more Fundmentals although that blue support line of yours looks pretty good. cheers on the help. start using that bigchart so my next one should be a little better. Cheers for the help

 

[Gurgler]

Re: Bottom pickers and knife catchers

How much further - or is this the bottom. Been a steady decline since launch and no prior bottom - are we there now!

 

[prawn_86]

Re: Bottom pickers and knife catchers

Hey Kennas,

One other thing that may be interesting to include on your spreadsheet is a "low" column. That way we could keep track of how much further each persons stock fell. IE - if they actually did get close to the bottom.

Even if you just updated the low column when people "sold" then it would give an interesting comparison imo

 

[Sean K]

Re: Bottom pickers and knife catchers

Hey Kennas,

One other thing that may be interesting to include on your spreadsheet is a "low" column. That way we could keep track of how much further each persons stock fell. IE - if they actually did get close to the bottom.

Even if you just updated the low column when people "sold" then it would give an interesting comparison imo

Aren't I covering that with the 'price' column, and 'current price' ?

Not exactly sure what you mean.

 

[Sean K]

Re: Bottom pickers and knife catchers

How much further - or is this the bottom. Been a steady decline since launch and no prior bottom - are we there now!

Is that a 'bottom's in' Gurgler, or you going to wait a bit longer?

 

[prawn_86]

Re: Bottom pickers and knife catchers

Aren't I covering that with the 'price' column, and 'current price' ?

Not exactly sure what you mean.

Yeh, but current price changes every day. When the person "sells" i think we should take a look back at the chart and find the lowest point and then include that, so we can see how much lower it went (if any)

 

[Sean K]

Re: Bottom pickers and knife catchers

Yeh, but current price changes every day. When the person "sells" i think we should take a look back at the chart and find the lowest point and then include that, so we can see how much lower it went (if any)

Will add that in on the sell.

 

[Sean K]

Re: Bottom pickers and knife catchers

Golly, maybe we need a 'potential' bottom thread to capture all these things tumbling.

I've followed this one for some time and owned it off and on on the way up, and part way down, but look at it now!!

The fundamentals are somewhere in its thread, but geez they've been punished.

Like Zn perhaps??

I'm not including this as a bottom yet, but just one to watch for a turn around. eeeeek.

 

[Gurgler]

Re: Bottom pickers and knife catchers

Is that a 'bottom's in' Gurgler, or you going to wait a bit longer?

Probably more for your 'Potential's' list. Will advise asap.