The first chart is the daily timeframe. We see that BIIB has been basing at the $60.00 level for a long time. Thursday's NRB (green) was the perfect setup leading into Friday's break. As mentioned in my pre-market post this was one to watch. If you watched too long though, it ran away, so decisive action was required in the early going.I used the 1 minute chart for my entry. After the OR, BIIB carved out a series of higher lows and I quickly picked a WR green bar as my base because the open was a bit choppy. I used a buy stop order and set my stop just below the lower blue line.
The next chart is the expanded view of the 1 minute timeframe, which shows how quickly price took flight once the initial choppiness was out of the way.
The last chart is the 15 minute timeframe. After a vertical move and three WRBs, I took a partial and tightened my stop a few pennies below the third WRB.
B&B patterns at pivot point resistance often result in vertical moves. In general, the longer the basing period, the better the BO. If you're not comfortable trading the open, you can try paper trading these at first or just entering with very small size until you develop a good feel for the pattern and the BO.
8 comments:
I was watching BIIB Friday morning and missed it. I will initially use the 1 minute time frame from the open from now on. I can always increase it later.
Zoomie,
The only other timeframe that could have worked is the three minute - break of ORH. The other timeframes would have been too slow I think.
I've been watching BIIB for about 2 weeks. I took 2 trades above $60 only to see it reverse at $60.50. Preety much gave up on it until I saw your watch on it. I entered as it broke $60.50 but as usual I exited way too early...
FYI: Carl Icahn is interested in buying more...
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=arKcUDBprzgM
PN,
I had heard rumors that BIIB was a takeover candidate but that article makes it pretty clear that Icahn is going to force the issue like he did with MEDI earlier this year. Might be a good swing candidate.
Some of the more interesting charts:
KYPH, JNPR, GRMN, NVT, AMLN
Jim,
Agree, but what about KYPH. How much play is left? Both KYPH and CKFR have nice charts but they were both recently acquired, KYPH by MDT and CKFR by FISV. Low risk on the downside but possibly limited upside as well. Do you agree?
Still reviewing my scans, but so far EMC looks good.
Jamie,
Absolutely agree now that I know KYPH was acquired. Beyond the technicals, I read almost nothing about companies. Some would say that is foolish. I depend on things of importance to be reflected in price and volume. For example, if my scans turn up a stock/company which was recently acquired (but I am unaware), I expect the decrease in volatility will keep me out. Wish I could stay on top of all the info, but time will not allow.
Jim,
I hear ya, there's been so much M&A activity lately, it's just by chance that KYPH rang a bell in the recesses of my memory.
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