Monday, April 16, 2007

MDII Chart


A reason to keep SVB (squeeze/volume/breakout) stocks on watch as long as you can. MDII had a couple of breakouts on volume. Then volume slacked off while the price based along the Muddy Zone through March. Came roaring back on 3/30 on 1.8 million shares and closed at 1.04. Ten trading days since then and it has more than doubled in price.

Actually, many people would have dropped this stock from their watch list when the volume went south; I know I did. But this is the power of having a "past runners" list in your head. A few weeks/months later you see it rolling on the HOD list and you just "KNOW" it's going to run again.

I don't think Muddy has mentioned it in awhile (though I believe Trapper has in chat), but the white candle filling the bands (see the first breakout) can be a very powerful buy signal, especially if it opens green the next day.

9 comments:

tristaina said...

Yesterday, I bought AGEN nice and early, at 3.38. I saw on your chat that you all were on it too. Before I knew it, it was up by a dollar. I had to leave, so I set a break-even stop at 3.49, thinking that it might want to descent a good bit and then take off again, as I have seen often happens. When I came back a couple of hours later I was stopped out, and obviously I feel a bit foolish for not having taken profits earlier on. Well, I wasn't there but, if I had been there I am sure that I would have been scratching my head, trying to justify selling or holding. My question: how do you decide that it's the moment to terminate the trade and pocket the gains? In this case, what did you do and on the basis of what reasoning?

tristaina said...

Sorry, those prices were bought at 4.38 and stopped out at 4.49

tristaina said...

Are you using your "bounce off zone" as the basis to stay in or get out?

Muddy said...

I use a 3-4% trailing stop as the stock runs up.
So I'd have put a stop at that point at whatever the high of day happened to be at the time you left.

Anonymous said...

Muddy, Laura,
do you daytrade or also swingtrade these sq/vol/breaks and MZ pullbacks?

Thank you

tristaina said...

Thanks for answering.

So then you are only trying to catch the move up. If it pulls back more than 4% and then breaks out again later on, as did RBY on Monday or INSW yesterday, you will try to get back in as it passes its hod?

tristaina said...

Also, I have noticed several times on the chat that you mention about "getting a buck". Is that to say that you use that as a sell signal in some cases?

Laura said...

Muddy, Laura,
do you daytrade or also swingtrade these sq/vol/breaks and MZ pullbacks?


Works for both.

Muddy said...

"So then you are only trying to catch the move up. If it pulls back more than 4% and then breaks out again later on, as did RBY on Monday or INSW yesterday, you will try to get back in as it passes its hod?"

I will get in again if I have an opening and it is not too late in the day near the close.
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"Also, I have noticed several times on the chat that you mention about "getting a buck". Is that to say that you use that as a sell signal in some cases?"

I say that only on higher priced ones usually over $15.
When I enter these that is my goal,to take a dollar out of it.
As with all priced stocks I almost always use a 3-4% trailing stop.