I just bought this stock! Help with this chart's resistance.

[jamesj188]

I bought some ENTR recently.
Guys, my question is this: Which of these resistances (picture attch) would you say are areas that the stock will have trouble going above that price.

There are 5 resistances: $9 $9.5 $10 $12 $14
and 1 upward trenline that was broken but could turn into resistance
My MAIN concern is some of the resistances were valid at one point but not anymore (ie. $10)

Please keep it simple if you can.
For example. I wouldn't consider $9.5 or I would strongly consider $10 and $12.

Thanks in advance.

 

[wackypete2]

The 9.00 & 10.00 lines are weak.

Just my opinion on what COULD happen:
Scenario 1 - Price fails at the 9.50 level. This stock would then be in a consolidation period. Wait for price to either break out over 9.50 or under 7.50

Scenario 2 - Price breaks over 9.50, 1st target would be where the upward trendline meets the 12.00 resistance line. (2 resistance areas converging)

 

[megamuel]

Hi mate,

I can't actually get this chart on my software because it's an American stock. Attach a blank chart and I will show you where I would draw the lines.

Sam.

 

[wackypete2]

Here ya go. Show us your lines

 

[eegozi]

I bought some ENTR recently.
Guys, my question is this: Which of these resistances (picture attch) would you say are areas that the stock will have trouble going above that price.

There are 5 resistances: $9 $9.5 $10 $12 $14
and 1 upward trenline that was broken but could turn into resistance
My MAIN concern is some of the resistances were valid at one point but not anymore (ie. $10)

Please keep it simple if you can.
For example. I wouldn't consider $9.5 or I would strongly consider $10 and $12.

Thanks in advance.

Hi,...new to this site but have been trading for a while now.

Nice find on the chart. TA starting to look promising. However, I think this one needs a bit more time to "ferment". When I see stocks like this I usually enter here and realize I am slightly too early. I think what will happen is that around $9 you will see resistance with back test down to around 8.06-8.23 level and then there will be more of a bounce through $9 there and then up to $9.5 resistance as well. Both are likely only short term if the stock is starting new up trend.

You may ask,...how can I be so specific? Well when I see this kind of chart I look at MACD weekly and daily. A new trend starts (in my opinion) when the daily MACD starts to go above 0 line, and especially when weekly start to go above 0 line. (currently both are below!!) This is especially true if they occur almost simultaneously on the 2 different time frames. This seems like it is about to happen. However when the weekly MACD has just started to curl up from below the 0 line there is VERY OFTEN a level of resistance right as the daily MACD breaks through 0 line and the market tests the guts of those that got in early. There is usually a backtest to the EMA 20 day before breaking through that weak resistance ($9 here) and during this time the weekly MACD shows more bullish divergence.

Point is I think you are a hair early in your trade (by 1-3 weeks) and will need to leave your stop alone and NOT move it up when it meets resistance at around $9 unless you want to take a quick small gain at that level and buy back in at around 8.06 to 8.23 level. I have layed out the next 2-3 weeks on this stock and am curious to see if I am correct. I will watch with you. GL on trade.

 

[eegozi]

Here,...I have attached a chart showing what I think will happen.

 

[wackypete2]

Good explanation. Nice way of looking at it.

Peter

 

[amit1986]

Trend lines and points of resistance/support work well in retrospect, but unfortunately, it's very rare for stocks to stop at support/resistance. In most cases, if a stock is near an important level of support/resistance, it will likely push through and hit all the stops and trigger all the limit orders. That is why discussing potential areas of support/resistance can be slightly pointless, especially if you plan on putting stops/limits in those areas.

Resistance/support should be used to judge how price behaves around a specific area - to see if it continues in the desired direction or whether it struggles and heads in the opposite area.

In your chart, the $9.5 and $10 seem to be most important areas to focus on.

 

[wackypete2]

Trend lines and points of resistance/support work well in retrospect, but unfortunately, it's very rare for stocks to stop at support/resistance. In most cases, if a stock is near an important level of support/resistance, it will likely push through and hit all the stops and trigger all the limit orders. That is why discussing potential areas of support/resistance can be slightly pointless, especially if you plan on putting stops/limits in those areas.

Resistance/support should be used to judge how price behaves around a specific area - to see if it continues in the desired direction or whether it struggles and heads in the opposite area.

In your chart, the $9.5 and $10 seem to be most important areas to focus on.

This is one of the methods I use to trade forex. If the stops are triggered and price moves back over/under the line then I enter a trade. I agree with you on the hindsight. It's not really a prudent idea to enter trades just because price is nearing a line. It's better to wait and see if the line holds.

Peter

 

[eegozi]

This is one of the methods I use to trade forex. If the stops are triggered and price moves back over/under the line then I enter a trade. I agree with you on the hindsight. It's not really a prudent idea to enter trades just because price is nearing a line. It's better to wait and see if the line holds.

Peter

Agreed on the trend line hindsight thing ,...but dont you guys think that support and resistance are just really areas of "defined risk"?. At support you have a defined risk knowing that if you enter a trade in the direction of the longerterm trend you have a limited risk and improve your chances of a profitable trade. At resistance the opposite occurs. We all know the reversion to the mean argument so at resistnace we should see a reversion to the mean and thus that is a good area to sell part or all of a position. Yes these are areas to place stops but I try to place my stops well enough away (usually 0.5-1 % beyond depending on timeframe of trade and volatility of the stock) so that they dont get hit easily unless I am truly wrong in my trade. If am am stopped out and then it reverses then I try to get back in. Just my 0.02.

 

[megamuel]

Hi James,

Sorry for the slow reply. Pete, thanks for posting up the chart. These are the areas I'd be looking at. I prefer 'areas' and not 'lines'. Lines just seem a little too specific. Plus I agree with Amit, it's not a matter of simply buying at support and selling at resistance or buying/selling breaks... These are just key areas to look at. They are key because if price breaks through them it changes the sequence of higher highs and higher lows, or lower highs and lower lows. Obviously you want the first combination when you are a buyer and the second when you are a seller.

So a break of the orange area would be bullish as price will have made a new high, a break of the red area above would be even more bullish and there wouldn't be much resistance up to that purple area. I'm not saying it would make it there just that there are not many obvious areas where people would want to jump in selling.

On the other hand a break of that lower red area would be very bearish. At that point I might wait for a pull back and enter a short. At the moment thought I'd wait to see if that orange area breaks.

Sam.

 

[jamesj188]

my guess is it will consolidate for some time at $9.5-$7.5 and then breakout.....$14 is around my price target.
I dont consider $12 because the price didnt really hold up as resistance and on the way back down it didnt hold up as support.... What do you guys think??? Would you say it is valid resistance?????



GREAT comments so far! thx.
By the way, someone mentioned macd...I made a new post called 'macd vs stochastics' please check it out and comment. thanks again guys.