@skygypsy I’m a technical trader and apart from knowing that ATS is in the energy/oil business that’s about all I know re the fundamentals. Having just browsed through the posts in this thread I now know that the drilling results will not be announced until end of March 2019. So there is plenty of time to wait yet. I believe that the chart will provide an early warning of what may be contained in the drilling results announcement. Volume and price action will let you know.
I have provided an updated and annotated daily momentum chart for ATS, see below. The setup that I described in my previous post was correct. In order to take a trade after a valid setup I need the SP to prove to me that it is in fact going to go in the setup direction. Hence in my previous post I suggested that it would be wise to wait for the SP to rise above the 50SMA prior to going long. With these types of spec stocks that I can’t trade using a low margin CFD, this means a close above the 50SMA. This did not occur and hence there was no long trade. The 60c level target was based on the rise in the previous impulse move and the Fib 100% projection. These target levels I generally refer to as “believe it when you see it” levels. There are always probabilities associated with TA. The purpose of these possible target levels for me is to allow a calculation of the reward/risk ratio for a trade. Along with the profit target you have to have a protective stop level as well of course. So when I have a large number of potential trades I can determine the best possible trades by comparing the Reward/Risk ratios. If you use the TA in a disciplined manner then over time and with lots of trades you can realise the system edge.
View attachment 1354341So much for basic trade system theory, and back to the question of what might be, i.e. have an above average probability of being, a suitable entry point. As the stock is going down and according to my indicators is now in a strong down trend, I would be looking for historical levels where high volume price action occurred. The obvious one on the chart is the price bar from 28/03, noted on the chart. I would expect a strong support level to be found in the range of 38c to 40c. The question you have to ask is that what would be the intentions of the Buyers who came in on Ultra-High Volume and purchased the shares back on 28/03, if the SP did in fact fall below the 38c level. I don’t know, but I do know that the 38c level is very significant and should be watched closely. If the SP falls below this level then you have to look for further levels of possible support. The 31c to 35c range may be a good choice, i.e. the previous Anchor Zone level range. It should also be noted that along with the SP being in a strong down trend, both weekly and daily momentum are headed down. My approach for trading these types of stocks is to wait until the SP proves to me that it has changed direction, and for me this means the SP trading above the 50SMA as a very first step. This does mean that you will not pick the bottom but there is far less chance of you getting stuck in a continued down trend. If you read some of my other posts you will find a description of what I call my Bottom Fishing Setup “BFS”. Recently I have found that in the current market these setups work well in the very short term but do fail when the SP hits the 50SMA in many cases. So allowing for this possible failure warning, it could be worth waiting and watching for a BFS with ATS. If I see one setting up I’ll let you know.
Hope this helps. All IMO of course.
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