BOOM before tuesday 27 february 2007 - after the close on monday i posted an analysis and chart of BOOM (click the underlined phrase to see that analysis).
so have yesterday and today change BOOM's chartscape? if we zoom out a bit we get see the following:
- the green circle highlights the april 2006 all time high
- the top red line is the downtrend line that was put in place in early september
- the purplish circle highlights BOOM's initial aversion to breaking above this
- downtrend line as the top of the previous gap (thin top reddish line) provides
- resistance (also notice the low volume at this time in the next chart)
- after the purplish circle, you can see BOOM finally breaks above the resistance and the red downtrend line
- the blue circle highlights yesterday and today
now, let's zoom back in
- the red circle contains yesterday's dow plunge candle and today's candle - notice how the corresponding daily volumes aren't necessarily low, but they aren't anywhere near the volume of the three previous trading days
- the two previous trading days in the blue and green circles represent the day of a post-market close earnings release and the day after earnings release, respectively. the huge volume coupled with price action that went relatively nowhere suggests distribution (or high turnover of stock, perhaps as smart or big money is unloading to those who want to play long the earnings and the explosive potential of BOOM)
- the day after earnings (the green circle), the price peaks but the stock closes down and weak for the day on huge volume
- the following day and the huge down candle represent heavy selling on less volume than the two previous days. the candle breaks the very short term uptrend line. why the big down day? i am not sure - the previous days' distribution is one reason - no one to buy, and perhaps there were some sector dynamics at play as well.
- again, the red circle contains yesterday and today. yesterday BOOM gapped down back to underneath the long term thick red downtrend line (discussed above). this represents a failed breakout for BOOM above this line earlier. BOOM also gapped down into that thin reddish line gap zone.
- on the bullish side, however, BOOM is being supported by the 200-day moving average (thin blue line underneath the body of the candles in the red circle, and these candles have closed above the purple short term uptrend line
bullish scenario - on thursday and after, BOOM opens anywhere above the purple uptrend line and holds that line, preferably closing above the thick red downtrend line and the thin reddish top of the gap zone line... it accomplishes that, however, there is more overhead resistance above (e.g., the bottom of that big downward candle)
bearish scenario - on thursday and after, BOOM gaps down and opens below the 200-day moving average and below that short term purple uptrend line, and closes the day below them. this to me would seem to indicate more downward motion.
either way it will be interesting...
