Joined: 29 Dec 2005
Location: Lubbock, TX
|Posted: Mon Mar 06, 2006 11:41 pm Post subject:
Not to be facetious, but any day can be the start of a downtrend. I understand what you are saying though.
Take a look at the stochastics. See how they are crawling across the top? This bespeaks a strong uptrend. I'd be careful about jumping for a slide down just yet. If it closes below the 20MA on heavy volume, then I'd give it a second look.
You'll see a similar drop in SBUX on 10/27/05. Look how it turned right back up the next day and moved up for awhile.
You might even consider this dip a buying opportunity instead of a shorting one. Be nimble here, though. And I would watch what it does tomorrow for about 15-20 minutes.
If the major indexes are headed down, and this one opens down, wobbles a bit, and then heads down and is down at about 9:45, I'd go short with a half position. If the major indexes are up and this one opens flat or up, wobbles a bit, and then heads up and is up at about 9:45, I'd buy a half position.
Since CAT is a Dow component, and since Dow is now in a downtrending channel, I'd be more inclined to see it move lower. Only the charts tell.
Peace and all good,