Improving Chart Analysis

[barney]

Hi there all, Only been here for a short time. Thanks to those (you know who you are) who have given me good advice so far.

I posted the following response in the CSR thread, but thought hardly anyone will read it there, and I would really like to get the opinions of you experienced traders as to whether I am on the right track with chart analysis. So I would really appreciate if anyone could have a look at Fridays chart on CSR and put my analysis (be it brief) of what it tells us, to the test.

Please feel free to be critical cause I dont want to keep stuffing up and losing money (I am pretty good at that if anyone wants some tips!!! ) Here is a copy of my post:- Thanks, Barney. (Geez I wish I could trade the way I play guitar...........)

I'm only new here and still a beginner with charts etc. but I figure if I put my opinions out there for people to judge, then it is kinda putting my money where my mouth is so to speak

Here goes: I think the chart on CSR looks to give a hint of possible reverse I like the rate of change (price) spiking off the bottom on good volumes and the ADM (negative) Index starting a downturn. Also the Bollinger curve has "opened its mouth" with an initial downturn. From what I read, this initial downturn is often a "false" signal with the sp often reversing Yesterday's sp did reverse a little (Monday or Tuesday will probably tell the story better)
I reckon CSR back to $3.15 before end of next week (unless of course the market in general fails)

Any comments from you guys who are way more experienced than I am, as to whether I am making sense, and/or are there other factors I should be looking at to give me a better assessment?? Cheers to all

 

[stink]

Hey Barney,

I am by no means an expert mate, but what are you trying to do with this trade? I only have a small chart to look at so havent got a complete view but to me it looks still to be in a downtrend? I have never been short so i dont know the in's and outs of a short position but because of the high turnover i imagine thats what people are doing with this stock??

I have no tools to apply to the chart so am just looking at the 1year chart and monthly volume, for me i wouldnt go near this due to my inexperience but yeah some of the more experienced may have a short view on this one?

Regards Stink

 

[tech/a]

I agree with stink.

This chart gives no indication that the current bearishness is over.
It is possible that it is in an accumulation phase however if price falls below the most recient low then this is still in trouble.
Even slight bullish moves will only see CSR trade in a sideways manner in my veiw.

There are better prospects.

 

[happytrader]

Hi Barney

Many of the best traders I know are muso/performers so you are in good company.

As for CSR chart analysis, if you are intending to go long why not wait patiently till the end of this quarter to look for entry. That way you can see where the stock traded and position yourself for the next quarter when it is likely to trade those areas again. Maybe if you take a peak at www.bigcharts.com and type in, au:csr, time - all data, frequency - quarterly you will see what I mean.

Cheers
Happytrader

Disclaimer: These are merely my opinions and nothing else.

 

[barney]

Thanks to all for the replies. Actually Porper in the CSR thread gave me similar opinions. I was probably trying to "get cute" with CSR thinking I might have been "seeing" into the future.....BAD IDEA!!......... I read (after I had already posted ) that the price of sugar is down 25% and even though CSR made a healthy profit this year it was down on market expectations..........so the fact that all you guys picked the chart correctly shows me Ive got a lot to learn....One of my favorite quotes re trading so far.........."Trade what you see,not what you feel" (I was trying to "feel CSR").. In saying that, maybe when it hits its bottom, there might be some nice profits onthe way back up.

 

[barney]

Hi Barney

Many of the best traders I know are muso/performers so you are in good company.

As for CSR chart analysis, if you are intending to go long why not wait patiently till the end of this quarter to look for entry. That way you can see where the stock traded and position yourself for the next quarter when it is likely to trade those areas again. Maybe if you take a peak at www.bigcharts.com and type in, au:csr, time - all data, frequency - quarterly you will see what I mean.

Cheers
Happytrader

Disclaimer: These are merely my opinions and nothing else.

Thanks H/T, Yeah Ive been lucky enough (when I was a fair bit younger!!) to "support" some of Australias best known bands (unfortunately our band/bands never got any where special...but good fun)..... I have no trouble cutting some nice riffs on the old Les Paul, but this trading is really testing me out. Cheers.

 

[hardmoney]

This stock would'nt even make my watchlist until it took out about $4.50.
Looks like a dog to me.



HM

 

[stink]

Hi Barney,

It sounds to me like your overcomplicating your entry criteria? Up until very recently i was doing the same thing, had to have this signal or that and then i wondered why i found it so difficult to make a decision.

So far from my very recent readings and postings on this forum i have worked out that the entry means bugger all really, i am comfortable that i could pick hundreds of potential trades quite easily. A few basic rules that i have started to adopt.
1. Get a big picture, go back to weekly and monthly charts, whats the trend doing? Once you see that its purely your experience that shows you an opportunity. If its in a long term down trend, i am staying away from it, no if's no buts, i dont care if everyone says its the trade of the year.
2. Find a suitable entry based on whatever tools you use, it doesnt really matter its what your comfortable with. I read this from Nick Radges book, i then went and tested the theory, i applied a whole lot of different indicators over the same stock and well they generally all say the same thing.
3. Trade your plan, once your in the trade adhere to your money management principles to the letter, no exceptions.
4.Review your plan. Why because as you learn your plan will evolve, i have changed mine about three times purely because i basically started making it complicated and now its quite simple really.
5. Dont jump into leveraged instruments to early.

Lastly mate, the above is not advice and most of it comes from others both here and in books etc. the main thing is you dont have to create an elaborate plan to trade successfully.

Regards Stink

 

[barney]

Hi Barney,

It sounds to me like your overcomplicating your entry criteria? Up until very recently i was doing the same thing, had to have this signal or that and then i wondered why i found it so difficult to make a decision.

So far from my very recent readings and postings on this forum i have worked out that the entry means bugger all really, i am comfortable that i could pick hundreds of potential trades quite easily. A few basic rules that i have started to adopt.
1. Get a big picture, go back to weekly and monthly charts, whats the trend doing? Once you see that its purely your experience that shows you an opportunity. If its in a long term down trend, i am staying away from it, no if's no buts, i dont care if everyone says its the trade of the year.
2. Find a suitable entry based on whatever tools you use, it doesnt really matter its what your comfortable with. I read this from Nick Radges book, i then went and tested the theory, i applied a whole lot of different indicators over the same stock and well they generally all say the same thing.
3. Trade your plan, once your in the trade adhere to your money management principles to the letter, no exceptions.
4.Review your plan. Why because as you learn your plan will evolve, i have changed mine about three times purely because i basically started making it complicated and now its quite simple really.
5. Dont jump into leveraged instruments to early.

Lastly mate, the above is not advice and most of it comes from others both here and in books etc. the main thing is you dont have to create an elaborate plan to trade successfully.

Regards Stink

Good onya Stink, Appreciate the advice....makes a lot of sense.....I think I'm just a bit edgy cause I got burned pretty bad with a couple of bad decisions and now my capital is so tight I cant afford to make any more wrong moves........Just trying to learn at the moment.......Lots of good advice around here which helps......... Cheers bud.

 

[stink]

Glad i could help mate,

Dont take my word for it, you need to prove this for yourself as do all traders i believe.

You will need to get that worry under control mate, if your constantly worried then dont put your money in. I have paper traded enough now to feel comfortable myself to put ssome $ in, i know there will be times i lose and i know how many losses i can take so i am comfortable that i can now make educated decisions and keep my money well protected.

Some say you cant learn until you have put your money into the market, i think thats rubbish you set yourself up to fail. Why would you do that?

Sure you will never know everything and you will make the wrong decisions sometimes but you have to accept it as all part of the business.

Regards Stink

 

[barney]

This stock would'nt even make my watchlist until it took out about $4.50.
Looks like a dog to me.



HM

I agree unequivocally, and dont take this the wrong way cause I'm not trying to be sarcastic (not in my nature), I repect that I will never probably understand the market to the degree you and many others in this forum do, but if we had all shorted CSR at the start of april we'd probably all be wearing big grins right now. (Sure you'd agree that just cause they dont go up doesn't mean you cant make money out of them ) All the best.

 

[wayneL]

CSR - Keep an eye on sugar prices

 

[Freeballinginawetsuit]

My charting analysis didn't mean much today!. Most of my trailing stops got hit when I expected a bit more in them yet.

 

[barney]

CSR - Keep an eye on sugar prices

Hi Wayne, Unfortunately I had already posted my (poor) chart analysis on CSR just prior to reading about the 25% drop in sugar this year..........What is your "gut feel" on sugar over the next few months (I believe CSR had a fair bit wiped out due to heavy rains in Q/land) Cheers.

 

[wayneL]

What is your "gut feel" on sugar over the next few months (I believe CSR had a fair bit wiped out due to heavy rains in Q/land) Cheers.

It would be a guess, but here are sugar prices going back to 1980. Sugar certainly can get cheaper...but it can also get on hellava lot more expensive too.

 

[barney]

It would be a guess, but here are sugar prices going back to 1980. Sugar certainly can get cheaper...but it can also get on hellava lot more expensive too.

Thanks Wayne, Point taken......worth keeping an eye on for sure (as you mentioned earlier).............still learning........Barney.

 

[coyotte]

Based on today's LOW (11/9) and C/B rules CSR would have to close above Thurs High (a new low would mean new High calc) before a Long entery.

But the last 3 breaks below the Bollinger Bands imply that a retrachment could be in the offering -- If it approached BUT does not break the C/B level , then @ that point you have SHORT set-up


Cheers

 

[barney]

Based on today's LOW (11/9) and C/B rules CSR would have to close above Thurs High (a new low would mean new High calc) before a Long entery.

But the last 3 breaks below the Bollinger Bands imply that a retrachment could be in the offering -- If it approached BUT does not break the C/B level , then @ that point you have SHORT set-up


Cheers

Hey there Coyotte, (you're not a muso are you, you keep late hours as well?!)

Thanks for the above analysis....
PS I have just read an old thread started by you in Trading Plans........I am going to bring it to the "front of the queue" again cause for newbies like me there are some "pearls of wisdom" in there......Cheers.

 

[barney]

Hi Guys, Just wondering whether my initial "gut feel" on CSR might not have been too bad (I was starting to question myself re what I was seeing), but I am kinda happy that this stock did reverse, cause thats all I was trying to pick,(the reversal after the long downturn) I thought I was a day or so early on the prediction, and that turned out correct .......I may have just got lucky of course!! .....It may well drop back into its bearish pattern............ I dont hold the stock btw.........
Interesting that it still managed to reverse after the 25% drop in sugar prices......???
At least it gives me a little more confidence in the way I am "seeing" the indicators.......and thats all I am after atm. Cheers all.

 

[coyotte]

Barney:

Sorry -- it's NOT about prediction ---- it's about understanding what the
" chart " is saying


Cheers