I’m new to VSA. First, I want to say that I have found this the most valuable thread I have ever read in any Forum. And I’ve been lurking on a few Forums for quite some time now. I’ve read Tom Williams' book and am making my way through this enormous thread. I realize that this is primarily a forex thread, but I wanted to post a stock chart and get your opinions on my analysis of the stock. The stock is HOTT. It is a retail clothing company in the states. I was fortunate enough to get into the stock in Feb at just below $9. It was a pre-VSA trade, but I have been using what I have learned to evaluate some of my current positions.
In the beginning of March, there looks like selling climax volume into support. After a retest of the support, price increased into a resistance area in the middle of March, where it backed off a little on decreasing volume. I’m not good at telling the difference between testing, shaking out, or no supply, but I see the decreasing volume as a bullish indicator. Price then broke through the resistance on good volume, another bullish signal. Price then rose to another resistance level. In the middle of April there was a gap down with decent volume and wide range. With the price increase the very next day, and the bullish signals in the background at the time, I look at this as a Shake Out? A couple of days later, the price broke through the resistance level with good volume, again bullish. What concerns me is that after the breakout, there is a no demand signal leading into a downtrend. The downtrend appears to be on low volume which makes me think bullish, but the NOD in the background concerns me. I was very happy with the reverse up-thrust on the second to last bar, but today’s action rocked me. Today’s drop was news driven. HOTT pre-announced that sales increased, but did not meet expectations. With the last bar being another reverse up-thrust, I believe there are still some bull money behind the stock. I am wondering if pros and market makers are using the news to discount the price for their benefit. HOTT’s earnings announcement is May 20th, and I’m wondering if those in the know believe that the earnings announcement will be good, and are loading up at a good price. I would welcome any comments on both my analysis and my position.
(The picture was too big, so I zipped it).
In the beginning of March, there looks like selling climax volume into support. After a retest of the support, price increased into a resistance area in the middle of March, where it backed off a little on decreasing volume. I’m not good at telling the difference between testing, shaking out, or no supply, but I see the decreasing volume as a bullish indicator. Price then broke through the resistance on good volume, another bullish signal. Price then rose to another resistance level. In the middle of April there was a gap down with decent volume and wide range. With the price increase the very next day, and the bullish signals in the background at the time, I look at this as a Shake Out? A couple of days later, the price broke through the resistance level with good volume, again bullish. What concerns me is that after the breakout, there is a no demand signal leading into a downtrend. The downtrend appears to be on low volume which makes me think bullish, but the NOD in the background concerns me. I was very happy with the reverse up-thrust on the second to last bar, but today’s action rocked me. Today’s drop was news driven. HOTT pre-announced that sales increased, but did not meet expectations. With the last bar being another reverse up-thrust, I believe there are still some bull money behind the stock. I am wondering if pros and market makers are using the news to discount the price for their benefit. HOTT’s earnings announcement is May 20th, and I’m wondering if those in the know believe that the earnings announcement will be good, and are loading up at a good price. I would welcome any comments on both my analysis and my position.
(The picture was too big, so I zipped it).
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