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Tuesday, January 30, 2007

Chart Reviews

chart reviews of Corvel (CRVL), Forsys Metals (FSY.to)

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I bought CRVL when I saw that it refused to go down below 43.5-ish. Previous low was 42.5-ish, so this marked a higher low, a strong sign of a recovering stock. Initial stop was at 43.3.

What should the stop loss level be now?
First a look at the daily to get some clues:

If you take a look at the weekly, it looks even better.
A tag of the 49 level is looking more and more likely here. Here are the following possibilities:

a. Runs up in a panic to 49 and beyond, then does a head fake, and falls back down to 47-ish.

b. Runs up but in a more orderly fashion, and settles to some price level that is higher than today's close.

c. No run-up, but some directionless sideways chopping around 47 for the next couple of days.

d. Selloff, drops below 46.5

The easy cases to deal with are c) and d). In both cases, my stop loss will be just under 46.5.
If a) or b) happens, I will have to think a little bit more as to how I will play this.

Forsys Metals (FSY.to):

It's interesting to note that Forsys tagged the 20d EMA, the first time that it's done that in this current run-up. It might be worth a shot at taking a low-ball bid right at the 20d EMA, although I have no clue when is the next time that will happen.

Uranium stocks are far from being done, so I see this as a buy opportunity coming up, not a sell opportunity. The other one that I played, Strathmore Minerals (STM.v), I will likely play again.

2 comments:

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