Stan Weinstein's Stage Analysis

Atilla

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Nov 15, 2006
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Hi Isatrader,

I have a cheeky favour to ask if you can do one of your SW Stage Analysis on Research In Motion RIMM the new BlackBerry please.

I have already bought into it but just wondering what your analysis might say.


Many thanks in anticipation (y)
 
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isatrader

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Oct 20, 2010
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Hi Isatrader,

I have a cheeky favour to ask if you can do one of your SW Stage Analysis on Research In Motion RIMM the new BlackBerry.

I have already bought into it but just wondering what your analysis might say.


Many thanks in anticipation (y)
Hi Atilla, I have done a chart markup so you can see where I'm at with the Stages etc, and should be fairly clear from it. Currently BBRY is in Stage 2, and the recent swing low has given an opportunity to raise the trader stop loss to around 11.38 imo, although it's a little early to raise the stop loss, as you shouldn't really raise it until the swing high has been broken, but due to the percentage moves in this I think it's acceptable on this occasion.

Relative performance versus the S&P 500 is positive and volume has had a significant pickup through the initial Stage 2 run. The recent sharp pullback volume looked big on a weekly bar, but it only made a small dent in the weekly cumulative volume, which remains above it's moving average. So if you are in it, then Weinstein's method has it as a "hold" in Stage 2 imo.

As a note the Stage 2A breakout point could be questioned as the 30 week SMA was only just turning from down to flat. So it was a more aggressive Stage 2A than most, and could have been considered as a breakout into a larger Stage 1 range imo. So the alternate 2A breakout point would have been the 11th Dec when it broke above it's swing high that formed above the 200 day MA.
 

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Atilla

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Hi Atilla, I have done a chart markup so you can see where I'm at with the Stages etc, and should be fairly clear from it. Currently BBRY is in Stage 2, and the recent swing low has given an opportunity to raise the trader stop loss to around 11.38 imo, although it's a little early to raise the stop loss, as you shouldn't really raise it until the swing high has been broken, but due to the percentage moves in this I think it's acceptable on this occasion.

Relative performance versus the S&P 500 is positive and volume has had a significant pickup through the initial Stage 2 run. The recent sharp pullback volume looked big on a weekly bar, but it only made a small dent in the weekly cumulative volume, which remains above it's moving average. So if you are in it, then Weinstein's method has it as a "hold" in Stage 2 imo.

As a note the Stage 2A breakout point could be questioned as the 30 week SMA was only just turning from down to flat. So it was a more aggressive Stage 2A than most, and could have been considered as a breakout into a larger Stage 1 range imo. So the alternate 2A breakout point would have been the 11th Dec when it broke above it's swing high that formed above the 200 day MA.

Much obliged thank you Isatrader,

I love the clarity and concise explanation of your charts. I'll stay in until $30s and may take half off after March / April and let the rest run. As for my stop I had 10.70 in mind but probably after recent rally 11.70-80 sounds better.

Best regards,

Atilla
 
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isatrader

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Watchlist

Here's a few of today's breakdowns and a potential breakout to new highs in the S&P 500. I think YUM has the best potential to breakdown imo, as it is showing a H&S pattern, as can be seen clearly on the weekly relative performance chart, and it's under performing the S&P 500 at only 13th from bottom in the RS table. It's also under performing it's sector as well by a long way.

So some stocks for consideration this week, if they close below or above their relevant breakdown or breakout levels.

P.S. Also I noticed Ford (F) has stabilised a bit, and is forming a potential swing low. I'm looking for a close tomorrow above today's high to complete the swing low imo, and would give a tight stop position (around 2 to 3 x ATR) for a potential pullback entry. See the daily and P&F charts attached. The P&F chart shows how the support identified from the early 2012 highs has held up so far.
 

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goodtyneguy

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Anyone for cotton pickin ?

Inverse H&S and "W" pattern, can someone check the RS. Plenty of potential in this one!

Page 332 shows an example of an orange juice trade, there was overhead resistance and the volume did not look very good on the breakout. Have we any evidence to say that we can ignore these with regard to futures trading?
 

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Feb 5, 2013
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Hi all

Fantastic thread - I've only just discovered it since reading Stan Weinstein's book very recently.

I'm very keen to try it out as it seems to be the best trading / investment (2 - 8 month) strategy I have come across.

As a novice to this method I'm looking at all sorts of potentials - what do people think of this chart - would you wait for a pullback?

My very crude method to spot potentials

a) 26 week breakouts
b) 52 week breakouts

and see if they fit with Stan's criteria.

Is it easier (or less risky) to wait for the pullback and invest once it starts rising again (as long as a higher low than breakout)?

Thanks anyone who can help.

Routy
 

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Feb 5, 2013
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P.S. Blue Star (from last nights above chart) has risen again since last nights chart to 0.5 currently +17% - 10.36 am.

Thanks
 

isatrader

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Oct 20, 2010
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Hi all

Fantastic thread - I've only just discovered it since reading Stan Weinstein's book very recently.

I'm very keen to try it out as it seems to be the best trading / investment (2 - 8 month) strategy I have come across.

As a novice to this method I'm looking at all sorts of potentials - what do people think of this chart - would you wait for a pullback?

My very crude method to spot potentials

a) 26 week breakouts
b) 52 week breakouts

and see if they fit with Stan's criteria.

Is it easier (or less risky) to wait for the pullback and invest once it starts rising again (as long as a higher low than breakout)?

Thanks anyone who can help.

Routy
Hi Routy, thanks for posting and I'm glad you're enjoying the thread. With regards to Blue Star (BLU) it's not really suitable for the method as it is a penny stock, which are for gambling, and not trading. As they can move huge percentages in either direction very quickly. You can of course still apply the methods principles to it, but you have no way of setting an appropriate stop loss due to the lack of liquidity in the stock and so could make a huge loss on it just as easily as a huge profit - hence why it's gambling imo.

Currently it's only just moved into Stage 1A in the last two days on a dramatic increase of volume, however, the 30 week MA is still falling and so even though it's broken above it's small base, Weinstein's method would put it as too early to consider yet, as it's one of Stan's firm rules that you mustn't buy a breakout when the 30 week MA is still declining.

Sub-penny stocks are not the kind of stocks that we look at on this thread, but as I said you can certainly apply the basic principles of Weinstein's method to them, if that's the path you want to take, as everyone has their own learning experience at the end of the day, and I was myself tempted early on in my trading education by the huge percentage moves that they offer, as I imagine a lot of beginners are. But soon learnt the downsides that they bring as well and moved on.

You mentioned that you read the book recently, so I'd recommend reading it again and taking notes, and then read through the thread from the beginning. As there's over a year and half of discussions on here that will answer a lot of your questions from reading the book, plus interviews, articles and hundreds of examples. The opening post has links to a lot of the key posts here: http://www.trade2win.com/boards/technical-analysis/134944-stan-weinsteins-stage-analysis.html#post1675606, and so I suggest taking it all in and then begin by paper trading or by trading only a very small account.

Good luck.
 
Feb 5, 2013
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isatrader

Thanks very much for the advice - I'll read the thread and book again.

Thanks again

Routy
 

isatrader

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Re: Anyone for cotton pickin ?

Inverse H&S and "W" pattern, can someone check the RS. Plenty of potential in this one!

Page 332 shows an example of an orange juice trade, there was overhead resistance and the volume did not look very good on the breakout. Have we any evidence to say that we can ignore these with regard to futures trading?
Yep cotton like many commodities can be a big mover when it gets some momentum. I've attached the continuous futures charts for you as they give the proper volume, which has been accumulating well since the breakout at around double the average. Relative performance versus the S&P 500 went positive following the breakout so I'd put this in early Stage 2A.

With regards to the resistance question, it is the same for commodities as it is for stocks as far as I know, so you do need to be mindful of it. But a technique not part of the method, but that I've found useful for gauging the resistance's importance, is to view the Ichimoku cloud (which is a dynamic way of seeing support and resistance) on the weekly and daily charts. Which in Cotton's case shows that price has just broken out of the weekly cloud and so the resistance strength is weak enough for it to advance from here, and so this looks to have potential for a good Stage 2 advance.
 

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goodtyneguy

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Re: Anyone for cotton pickin ?

Yep cotton like many commodities can be a big mover when it gets some momentum. I've attached the continuous futures charts for you as they give the proper volume, which has been accumulating well since the breakout at around double the average. Relative performance versus the S&P 500 went positive following the breakout so I'd put this in early Stage 2A.

With regards to the resistance question, it is the same for commodities as it is for stocks as far as I know, so you do need to be mindful of it. But a technique not part of the method, but that I've found useful for gauging the resistance's importance, is to view the Ichimoku cloud (which is a dynamic way of seeing support and resistance) on the weekly and daily charts. Which in Cotton's case shows that price has just broken out of the weekly cloud and so the resistance strength is weak enough for it to advance from here, and so this looks to have potential for a good Stage 2 advance.
Thanks ISA, I was wondering if the continuous commodity charts were available in PRT. Have n't got around to doing that yet. Hopefully sometime today. :)
 
Feb 5, 2013
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isatrader

For my education is this now into stage 2?

Is it worth considering from the chart (the sector is positive)?
It finished up 6.5% today at 175.5 on 1.8 million volume.


Thanks again

Routy
 

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isatrader

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isatrader

For my education is this now into stage 2?

Is it worth considering from the chart (the sector is positive)?
It finished up 6.5% today at 175.5 on 1.8 million volume.


Thanks again

Routy
It's been in Stage 2 for two months since the weekly close above the Stage 1 range on 7th December imo. So it has moved 113% already and hence would be considered Stage 2B now and so a hold late in the Stage 2 uptrend. The fact that it's gone parabolic would mean it would be sensible to take profits at this point if you'd got in at the Stage 2 entry point. But you certainly wouldn't be considering buying here as it's very extended from it's moving averages.
 

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