Boots

[Mooringsman]

This looks undervalued on fundamentals, but more interestingly it has shown steady Money Flow Index increases since late May, despite a drop in the price in between times. It looks as if it is experiencing a sell off today, but there are some big buys coming into the market now (3:30pm) eating up the sales difference. It is above it's 20 day moving average as well - something I personally like to see. OBV also on a rise.

Note Added

View this on OHLC bars as a price line misses out on the story and would lead you to draw the wrong trend lines.

 

[esiotrot]

Hi Sam
I must profess ignorance of Money Flow Index; or perhaps it might be more true to say that it's not an indicator I understand fully and therefore do not use it.

As it is obviously something you use regularly maybe you can give me a run down.
I use RSI which I believe is similar(?) and look for either overbought/oversold levels or for divergences from the price action. Money Flow Index uses volume (I think) but what should I be looking for?

As for BOOT I'm not sure; appears to be in a downward price channel. Possibly going to the upper BB at around 615/620 but who knows?
Support at 575 and resistance at 633 appear to be the major points of interest.

Peter

 

[darth trader]

Sam,
Boots is another stock from the General Retail sector that has been recently been discussed on this board almost as often as the techs!

From my point of view Boots has been forming a base since q4 99 and becomes an interesting play when it breaks through resistance at 640p.

As always there is no one way to pick stocks or entry points so if it suits your risk/reward ratio there may be more upside (or downside) by entering now.

Sainsbury, Safeway and WH SMith all moved up today and are worthy of investigation too.

 

[Riz]

Hi Peter,

MFI is related to RSI, only it accounts for volume rather then price...shortly it measures strength of money in and out of a stock...

When the price trends higher and the MFI lower or the other way round, we look for a possible imminent reversal...

Riz

 

[Mooringsman]

Hi Peter,

Money Flow Index (MFI) is a momentum indicator that measures the strength of money in and out of a security. A divergence between the MFI and price trend can be interpreted as a possible trend reversal. It is similar to the Relative Strength Index (RSI). The difference is that the MFI also accounts for volume where the RSI only incorporates prices.


I think Darth is right on reflection Boots needs to clear 650p.

Sam

 

[Sparky]

Worth remembering.
The price must surely always be the leading indicator, other indicators that we all use are only relevent when the price has indicated a directional move, reversals, breakout etc.
A stock price having performed a trading patern, double bottom, head and shouders, cup and handle etc,used in conjunction then with other key indicators would give us a much stronger trade signal.
Boots has moved up from a single bottom, a lower low and having broken below a triple bottom support level . This signal is too weak to suggest its a buy to me at this time.I think it will find its short term resistance level and retrace back, then the possibillity of a more sure launching pad may arise, i.e. a trading patern with more credibillity and drive.

Sorry to go on, but I think that it is important to state that stock selecting is not just a case of waiting for an indicator to point in the right direction to indicate that its now a buy or sell, as I know that this site is visited by traders with various levels of experience.

 

[Mooringsman]

Hello Sparky,

Thank you for your reply with which I agree.

What I had noticed about Boots was an overall decline in MFI since mid April, but a strong rise up from it's low in early June. It is now at a point of resistance to this downtrend and will either push on through it or retrace. This is accompanied by a continued strong rise in OBV reaching a new high since early June as well.

These strong shorter term indicator movements are not really reflected by the actual price line and so I was interested to see if there might be some pressure building from below to create a more significant rise in the price soon. By looking at the trends of these indicators I was wondering if an earlier warning was detectable. I accept this is rather clutching at straws, but as I have said I was interested by the idea.

Sam

 

[Sparky]

Sam,

Sounds like a good idea to me, we are all looking for early signs re;entry and exit points.My post was a general one really, just felt that it was worth stating the basics again, as sometimes it seems as if these are overlooked, as I have learnt to my cost in the past.
Good luck with your trading stratergy and remember if you do find the holy grail, that I am only an e-mail away!

Regards
Sparky

 

[sefty]

boots using 5 and 10 day MAs

Like this one.
First picked it up on a MA crossover. A method i have disscused before on this site and has held me in reasonable good stead in recent times.

If you have forgotten this method take a look!

http://www.trade2win.co.uk/bb/showthread.php?threadid=2293&highlight=using+Moving+averages


good luck happy trading

sefty

 

[Mooringsman]

Boots has been quietly ticking up

Boots now has a bid price of just over 650p, but this is bound to set off a load of sells. It will be interesting to see the close price on a bid is still over 650p. It needs to demonstrate this level as support.