Intuitive / Analytical Practical Application

[charthawk]

test...new member -1st post
http://stockcharts.com/def/servlet/SC.web?c=cpe,uu[e,a]daclyiay[pc9!c20!c50!c200!b200!f][vc60][iut!La12,26,9!Ll14!Lh14,3!Lb14!Lg]&pref=G

 

[charthawk]

full chart link would not attach...test2

http://stockcharts.com/def/servlet/SC.web?c=cpe

 

[ducati998]

Thanks charthawk,
Just in case any one wants to update anything on a technical basis.

cheers d998

 

[ducati998]

1111

 

[ducati998]

Tapeworm,
Sorry missed your post............just saw it now.

I will take a shot. Bearish next 2 to 10 days. Short at 16.50 to 17.00 when tape indicates best entry. Stop loss 17.50. Cover anywhere below 15.00 within next 10 days. This could change some depending on what the tape says tomorrow. However, I will state at what point I did take a simulated position and then we will see how that position turns out.

Hey and its your first post, so welcome, and lets see what happens. Nice to see someone else take a stab. What promted a stoploss at $17.50?
The reason I am asking is that $17.50 is actually quite an important price level for some rather specific reasons. Can you expand on your reasoning?

This is pure tape reading analysis. No indicators.

Any volume with that? Or just pure price?
cheers d998

 

[Tapewormtoo]

Oops! Was up late last night and I missed the open so I missed the shorting opportunity at 16.16 instead of 16.50. Don't know if it will rally back up to 16.50 within next 5 days. Will be able to tell more after the close today. Anyway, reading the tape the short would have been 16.10 - 16.16 instead of 16.50.

It has been bearish as I thought. Will probally make 15.00 or under covering point within next 2 days.

Naturally, if it makes 15.00 and tape says it will keep going down I would not cover but hang on for more profit.

TW2

 

[ducati998]

Tapeworm,
Nice call.
The stock as being traded by traders would seem to mirror the price of oil.
The Company however will hedge the price for delivery.
Therefore, the current improvement in prices could make a difference to the next years earnings.

cheers d998

 

[ducati998]

22222

 

[ducati998]

CALLON PETROLEUM (NYSE:CPE) Delayed quote data

Last Trade: 15.39
Trade Time: 3:50PM ET
Change: 0.83 (5.12%)
Prev Close: 16.22
Open: 16.16
Bid: N/A
Ask: N/A
1y Target Est: 17.33

Day's Range: 15.04 - 16.16
52wk Range: 10.15 - 18.00
Volume: 160,100
Avg Vol (3m): 131,090
Market Cap: 272.73M
P/E (ttm): 12.93
EPS (ttm): 1.19
Div & Yield: N/A (N/A)


Down to that support @ around $15, still held today.
Quite volatile at the moment.

Tapeworm,
Would you have held, or exited at or near the low?
If you held, what is the plan.

On a purely technical basis, I would still be long, the exit would be dependant on which analysis I had entered on.

cheers d998

 

[Tapewormtoo]

Tapeworm,
Would you have held, or exited at or near the low?
If you held, what is the plan.

On a purely technical basis, I would still be long, the exit would be dependant on which analysis I had entered on.

cheers d998

Ducati,

I would still be short. According to the tape I expect it to go below 15.00 tomorrow or the next day. Most likely tomorrow.

You may get stopped out of your long position within next day or two.

My plan: as long as tape looks weak I will hold my short position. If I see too much strenght coming back in then I will cover.

tw2 (for tapewormtoo)

 

[ducati998]

Tw2,
Possibly I will be stopped out, there is always that risk.
However, for the following reasons, I think I will be ok.

1........From the Fundamentals, I would say there is little to no "Value investors" they have moved on. Do the technical traders know this or even care, probably not.

2........Support @ $15 has held twice now, and that will build confidence for all technical traders.

3.........Stocks stumble to end flat after consumer prices show the biggest rise in five months. Crude oil jumps when a BP refinery blast kills 14, then falls back. MCI will resume Qwest talks. GM may end Buick or Pontiac brand.


Today's words: Sentiment shift . . .

. . . which we will define as a change in market mood and expectations. Yesterday produced a huge sentiment shift when the Federal Reserve said inflation is something to watch and that it will move when necessary to keep it under control.

As we all know, stocks sold off in a big way after the Fed raised rates yesterday, and interest rates jumped. Everyone suddenly was talking about inflation. And how bad the troubles at General Motors really are.

Today was dominated by words like "fragile," "precarious," "tentative," "delicate" and, dare we say it, "vulnerable." Not helping the situation near the close was the BP explosion outside Houston that killed 14 workers. Oil prices and gasoline futures, which had been lower on the day, promptly jumped. Crude prices later fell back..

With the damage in Houston, which is the Bay of Mexico, where CPE has its rigs, this could be very bullish for the stock, I feel it is predominantly short-term traders providing the daily volumes, and this will be sentiment based.

4.......... Callon Petroleum Company: Ownership

Ownership Information
Shares Outstanding 18.00 Mil
Institutional Ownership (%) 70.50
Top 10 Institutions (%) 48.64
Mutual Fund Ownership (%) 13.41
5%/Insider Ownership (%) 41.46
Float (%) 58.54
Ownership Activity # of Holders Shares
Total Positions 86 12,690,893
New Positions 20 707,100
Soldout Positions 10 -454,941
Net Position Change 28 1,288,903
Buyers 53 2,427,787
Sellers 25 -1,138,884

Palo Alto Investors 1,775,200 809,100 84.0 13,419,244 9.9 1.2 12-31-04
Wellington Management 1,517,900 45,500 3.0 3,278,802 8.4 0.0 12-31-04
North Sound Capital 1,400,600 -99,400 -7.0 1,232,676 7.8 1.0 12-31-04
Dimensional Fund Advisors 1,351,100 262,600 24.0 5,734,726 7.5 0.0 12-31-04
Kennedy Capital Management 507,200 15,900 3.0 1,104,428 2.8 0.1 12-31-04
Barclays Global Investors Intl 494,140 -5,663 -1.0 807,762 2.7 0.0 12-31-04
Ingalls & Snyder 490,995 855 0.0 884,813 2.7 0.4 12-31-04
Imperium Capital Management Llc 488,700 -219,400 -31.0 -1,912,106 2.7 1.5 12-31-04
Sterling Johnston Capital Mgmt 410,950 70,600 21.0 1,626,699 2.3 0.4 12-31-04
Charlotte Capital Llc 318,700 318,700 100.0 4,608,402 1.8 1.1 12-31-04
Killen Group 310,283 43,070 16.0 1,098,431 1.7 1.9 12-31-04
New York Life Investment Management Llc 271,002 96,592 55.0 1,707,170 1.5 0.0 12-31-04
Vanguard Group 248,525 5,600 2.0 513,383 1.4 0.0 12-31-04
Martingale Asset Management 161,147 103,347 179.0 1,597,282 0.9 0.1 12-31-04
State Street Global Advisors 159,546 40,365 34.0 795,820 0.9 0.0 12-31-04

Dfa Inv Tr U.s. Small Cap Value Series 552,700 154,300 38.7 1,486,763 0.0 0.0 11-30-04
Eclipse Small Cap Value Fund 162,700 121,600 295.9 -69,961 0.0 0.0 10-31-04
Vanguard Total Stock Market Index Fund 148,386 17,200 13.1 -234,450 0.0 0.0 09-30-04
Us 9-10 Small Company Portfolio 121,600 0 0.0 327,104 0.0 0.0 11-30-04
Tax-managed Us 5-10 Value Portfolio 117,900 37,200 46.1 317,151 0.0 0.0 11-30-04
Oppenheimer Main Street Small Cap Fund 100,600 0 0.0 -158,948 0.0 0.0 09-30-04
Gabelli Small Cap Growth Fund 95,000 0 0.0 169,100 0.0 0.0 12-31-04
Hirtle Callaghan Tr Small Capitalization Equity Portfolio 81,050 81,050 0.0 1,155,773 0.0 0.0 06-30-04
Ishares Russell 2000 Index Fund 77,154 77,154 0.0 978,313 0.0 0.0 09-30-04
Vanguard Extended Market Index Fund 69,119 10,900 18.7 -109,208 0.0 0.0 09-30-04
Asaf Gabelli Small Company Value Fund 60,000 -2,000 -3.2 -25,800 0.0 0.0 10-31-04
Ast Gabelli Small-cap Value Portfolio 59,000 0 0.0 -93,220 0.0 0.0 09-30-04
Veedot Fund 45,000 0 0.0 -19,350 0.0 0.0 10-31-04
Svs Dreman Small Cap Value Portfolio 40,200 40,200 0.0 573,252 0.0 0.0 06-30-04


*Category Headings:
Shs Held - shares held at report date
Shs Chg - position change within reporting period
%Chg - % change
$Chg - market value of the position change
%Out - % of shares outstanding
%Port - % Portfolio
Rpt Date - report date

Therefore, with the vast majority of shares being held for the longer term, volatility, which has been bourne out, is likely to be maintained, or increase, as the marketmakers must generate volume on a limited float. Sentiment, manipulation, and any other tricks that can be thought of will predominate in the next 1year or so.

cheers d998

 

[ducati998]

Just a general question based on that adage.........cut your losses, let your winners run.
Taking CPE as an example, and assuming an ENTRY @ $15.25 .....STOP @ $14.80, POSITION SIZE @ 1000 ....EXIT @ $16.60, .....this will calculate out at exactly a 3:1 R/R

Now, you could have exited quite easily near the open a couple of days back at your target.
Or, do you, stay in the trade until you are taken out, by either your stop, or exit on an EMA, 180 in this case.

Purely, from a psychological perspective, which one lends itself more easily to discipline, and a structured plan? What are you actually basing your opinion on? Resistance levels? Some # plucked out of thin air, as it conforms to a R/R based on your stoploss level, market participants deciding for you? Other?

cheers d998

 

[Tapewormtoo]

Now, you could have exited quite easily near the open a couple of days back at your target.
Or, do you, stay in the trade until you are taken out, by either your stop, or exit on an EMA, 180 in this case.

Purely, from a psychological perspective, which one lends itself more easily to discipline, and a structured plan? What are you actually basing your opinion on? Resistance levels? Some # plucked out of thin air, as it conforms to a R/R based on your stoploss level, market participants deciding for you? Other?

cheers d998

I base my opinion on just old fashioned tape reading. No resistance levels...No indicators... No MA. I will stay in with a short position until the "tape" indicates strenght is coming back in. Then I will cover. That may be (most likely will be) below 15.00 or it may be just close to 15.00 if strenght comes in tommorrow. The tape after close today says it is weak so I expect further decline tomorrow. Just have to wait and see what the tape says tomorrow.

I expect it to trade at least down to 15.00 tommorrow unless as you say it turns bullish because of the Houston explosion. However, if it does the tape will tell the story!

TW2

 

[ducati998]

DIRECT COMPETITOR COMPARISON

..................................CPE ......................APA.............. CVX.................. Pvt1............ Industry
Market Cap:........... 272.37M.............. 19.72B........ 123.55B .............N/A ............282.83M
Employ*ees: ............87 .........................2,642 .............56,000 .......119,000...............167
Rev. Growth (ttm): 62.60% ................63.70% .......27.50%............. N/A ...............31.60%
Revenue (ttm): .....119.80M................ 5.33B ........155.30B ........201.73B1........ 119.80M
Gross Margin (ttm): 81.38%.............. 82.17%...... 14.28% ...........N/A ...................68.36%
EBITDA (ttm): .........80.96M............... 4.01B.......... 25.89B .............N/A ..................26.31M
Oper. Margins (ttm): 27.97%.......... 49.94%........ 13.23%............ N/A ..................27.18%
Net Income (ttm): 20.23M ................1.66B........... 13.03B ..........12.50B...............1 5.20M
EPS (ttm):............... 1.19 ....................5.051 ...........6.127 .............N/A....................... 0.30
PE (ttm): ...............12.92................... 11.90 ............9.58 ...............N/A .....................17.14
PEG (ttm):............. 0.65 ....................1.24.............. 2.22................. N/A .....................1.46
PS (ttm):................ 2.27.................... 3.67............. 0.79 .................N/A...................... 3.28

The market cap, here definitely shows that there is some advantage to traders, trading the smaller caps, if, it moves your way, or is manipulated your way.

cheers d998

 

[ducati998]

Tw2,
Would you agree that, based on any of the technical studies posted, that the trend could currently be defined as UP. The trend, is still intact, with a pullback in place.

If you accept that as true, then, you would have placed a hypothetical "counter-trend" trade. The initial trade was timed very well, and delivered instant profit.

If, you in point of fact disagree with the above, and feel that the "trend" has been broken, which is entirely possible, but would violate most technical rules, could you define what you saw in the P&V analysis that led you to that conclusion?

Of course this brings up a very interesting point, which is.
If the Technical Rules are so easily broken, of what use are they to your average trader? We shall exclude those operating in some ESP modality.

My analyses, were based on basic technical rules, and all 4 or 5 variations took a total of 10mins, including posting time.
Is it reasonable to expect to be paid huge sums of money for so little effort?
Would you not expect to have to work a little harder than that?

However, the harder you work, and the more effort you put in, will this start to cause stronger bias and belief to be blended into the analysis..........your stop is hit, do you now exit? Or, do you give it a little wiggle room, as hey that stop was a little tight, and actually it should have been at $14.71, if we are to be really accurate about this.

food for thought
d998

 

[Tapewormtoo]

Would you agree that, based on any of the technical studies posted, that the trend could currently be defined as UP. The trend, is still intact, with a pullback in place.

If you accept that as true, then, you would have placed a hypothetical "counter-trend" trade. The initial trade was timed very well, and delivered instant profit.

I didn't use trend lines in this trade. There is no law that says a trend must continue. It is an arbitrary line drawn by a human on a chart. I see drawing such lines as a useless exercise. Chart patterns such as triangles--useless, double bottoms..etc..all useless. Of course -my opinion!! Support and resistance prices are a little useful in predicting possible momentary stopping points for price but then again there is no law saying they will hold. However, I do find them a little useful in projecting potential pricing areas for tomorrow BUT they ALWAYS must be compared to the tape. I am sure there are plenty that would disagree with me.

If, you in point of fact disagree with the above, and feel that the "trend" has been broken, which is entirely possible, but would violate most technical rules, could you define what you saw in the P&V analysis that led you to that conclusion?

Don't care if the trend is broken or not. Useless exercise for me. I look only at the tape. Don't care about any trend or chart pattern in the sense of Traditional TA. For me trend doesn't matter. The tape does!

Of course this brings up a very interesting point, which is.
If the Technical Rules are so easily broken, of what use are they to your average trader?

I guess some TA pattern trader will have to comment on that.

My analyses, were based on basic technical rules, and all 4 or 5 variations took a total of 10mins, including posting time.
Is it reasonable to expect to be paid huge sums of money for so little effort?
Would you not expect to have to work a little harder than that?

Tape reading is fast. Sometime less than the 10 minutes. Sometimes seconds. And it can produce some pretty big returns.

However, the harder you work, and the more effort you put in, will this start to cause stronger bias and belief to be blended into the analysis..........your stop is hit, do you now exit? Or, do you give it a little wiggle room, as hey that stop was a little tight, and actually it should have been at $14.71, if we are to be really accurate about this.

IMO stops shouldn't be adjusted if the tape is saying your position is wrong unless they are adjusted to even lessen the loss. On the other hand, I think potential profit taking should, and can be changed, if the tape is saying your position is correct and you can go for more profit.

I am still short. Will look at tape this evening and will post my strategy for tomorrow.

tw2

 

[ducati998]

Well, stayed pretty much where it was.
Seemed to trade with the market pretty much today.

So, trades with oil price, market generally, and any number of variables. Can you legitimately form an opinion on the stock itself, or must you look at proxies, and form an opinion on them, and then use the stock as the vehicle?

Or, is the stock a valid analysis on its own account from either a fundamental or technical point of view?

CALLON PETROLEUM (NYSE:CPE) Delayed quote data

Last Trade: 15.35
Trade Time: 4:02PM ET
Change: 0.00 (0.00%)
Prev Close: 15.35
Open: 15.36
Bid: N/A
Ask: N/A
1y Target Est: 17.33

Day's Range: 15.17 - 15.58
52wk Range: 10.15 - 18.00
Volume: 65,300
Avg Vol (3m): 130,636
Market Cap: 272.02M
P/E (ttm): 12.90
EPS (ttm): 1.19
Div & Yield: N/A (N/A)


From a technical viewpoint, still in the trade.
Tw2, how about you? What did the tape say today?

cheers d998

Tw2,
Just saw your post.

 

[Tapewormtoo]

CPE

Demand appears too be creeping back in according to the tape. I will watch CPE tomorrow and if it looks like no more decline then I will cover the short as close to the low as I can and look to go long tomorrow or the next few days.

Ducati you are still in the market and didn't get stopped out. It appears after the sell off yesterday demand began to creep back in before the close. That was confirmed today as it held a higher low on low volume which hints at the sellers did most of their selling yesterday so supply is drying up. It may track sideways a day or two or begin to head back up but it does appear to be turning into a long candidate.

It didn't fall below 15.00. I really did think it would today but I guess supply started drying up before the close yesterday.

tw2

 

[ducati998]

Tw2,

I didn't use trend lines in this trade. There is no law that says a trend must continue

I couldn't agree more. The trend, while giving the impression of mathematical precision, through the use of numbers, is in point of fact, an exact prediction of the future, and must thus be either right or wrong. If wrong, you will lose money.

Yet, and here is the paradox, traders will lend great credence to the trend, as possessing a mathematical probability, due to the use of any number of mathematical constructs.

It is an arbitrary line drawn by a human on a chart. I

As I previously mentioned, if we do however for the sake of argument accept for the moment that the "trend" as defined by lets say the 200EMA, ( which is a mathematical construct, as opposed to an arbitrary line ) is currently bullish, then your initial entry was "COUNTER-TREND" and, from an expectancy of time in the trade must be short.

Now, from your analysis of PRICE, which, suggested weakness and a decline to $15 or below, we now have via PRICE analysis, a case for strength, and a bullish outlook.

Don't care if the trend is broken or not. Useless exercise for me. I look only at the tape. Don't care about any trend or chart pattern in the sense of Traditional TA. For me trend doesn't matter. The tape does!

The point that I am trying to make is that PRICE in isolation may very well work in a short-timeframe, viz. the short entry, and subsequent decline, but now, 2 days later, the message has changed. PRICE, I contend is nothing more than short-term sentiment, as likely to change as the wind blows, and as such, useful for daytraders, but very limited for position traders.

Of course this brings up a very interesting point, which is. If the Technical Rules are so easily broken, of what use are they to your average trader?

I guess some TA pattern trader will have to comment on that.

Yes, it would be interesting to have alternate opinions.

My analyses, were based on basic technical rules, and all 4 or 5 variations took a total of 10mins, including posting time.Is it reasonable to expect to be paid huge sums of money for so little effort?Would you not expect to have to work a little harder than that?

This is not really a question on how long it actually takes, more of a question of, if TA is in point of fact so simple, viz 5 analyses in 10 mins, is it reasonable to expect huge financial rewards?
Most professions would require a great deal of time and effort to generate outsized returns that are expected from the market.

And the counter-point is..........if in point of fact, the returns are not forthcoming due to such a lack of effort, then, do we run the risk of the following scenario?

However, the harder you work, and the more effort you put in, will this start to cause stronger bias and belief to be blended into the analysis..........your stop is hit, do you now exit? Or, do you give it a little wiggle room, as hey that stop was a little tight, and actually it should have been at $14.71, if we are to be really accurate about this.

You see, the more effort we put into our work, whatever that work may be, the greater our pride and sense of achievement in that work. Now, traders cannot afford this mindset..........they are either right or wrong..........if wrong they lose money even if it took them 6hrs to find and analyse this trade that took 30secs. to go against them..................the temptation, the slippery slope is to have pride in your work .....and give it time to prove you right.

cheers d998

 

[Tapewormtoo]

Now, from your analysis of PRICE, which, suggested weakness and a decline to $15 or below, we now have via PRICE analysis, a case for strength, and a bullish outlook.

Ducati,

Price did not say it would go below 15.00. I said that! Price said it would go down yesterday and it did. Below 15.00 was my opinion based on the fact that the tape showed weakness. It was weak today. Just not as weak as I thought it would be. Or would you say it was strong today?? All I say is that demand is picking up but is was still weak all day. Price is also saying now it is looking bullish. The tape is the tape. It tells it owns story. It would be quite foolish to say that price can't never change from bearish to bullish. Prices change all the time! We have to simply adjust. To say that I was bearish and now am bullish makes analysis by price as an unworkable way to trade is going a little to the extreme. Of course, you didn't say it exactly that but that is what I seem to get from you. Yesterday you said good call. Today you seem to be making light of what I see in the tape. Are you?

Keep in mind my tape readings are from one day to the next not forever!!!

All you have to do is capture the moves in the shorterm to make so money and the tape can and does help one do this.

tw2