I’ve posted this first in our Private Clients Forum for our EquiPicks subscribers.
I’m sharing this with you, even if you’re not a subscriber yet, so you’ll have a first-hand experience of the quality of our response to the questions or requests for an update of our clients in our Private Clients Forum.
Today, we’ve seen how important it is to learn how to identify the stock’s support and resistance levels.
Why am I emphasizing this?
Pay attention to the Daily Chart of NOW below.
NOW respected the support at 4.28.
You’ve also seen the meaning of what I have mentioned several times in the forum: “Sentiments change when things change.”
What does that sentence have to do with what happened with NOW?
Yesterday, I posted, “I do not recommend entering a new position yet. Monitor this stock for now.”
That advice was true as of the end of trading yesterday.
Hence, active trading truly demands to have the luxury of time to monitor the market from opening until closing. Otherwise, you’re at the mercy of hoping and praying that your verdict as of yesterday’s EOD might still stand as a true statement by the next trading day.
Today’s volume was bullish. Apparently, traders of NOW must have realized that it was too cheap to ignore when it kissed the support at 4.28 yesterday.
However, I’d like to remind you that the top 10 players of NOW today didn’t give us a big green bar. While 6 out of 10 top players gave us a green bar today, notice that their Net Amount is nothing compared to the Total Turnover Value of each broker.
What does it mean?
That means these 6 out of 10 players with a green bar are not that convinced yet that NOW is going back from where it left off 3 trading days ago (P7sh/share zone). Because if they were really that convinced that NOW is going to be very bullish from here, the height of their green bars should be as tall as the height of the blue bar.
I hope you’re not rolling your eyes as I say these things because I’ve already explained in detail how to interpret the statistics of the Top 10 Players chart in our Quick Start Guide. In fact, writing the paragraph above feels like I’m just parroting what I wrote in the Quick Start Guide.
“Jaycee, where are you getting all these thoughts? Where do you derive these thoughts? Is it only your hunch or you can also back your thoughts up with numbers?”
Of course, I can back my statements up with numbers.
What made me conclude that these 6 out of 10 top players are really not that bullish yet?
In addition to what I’ve mentioned above, look at the buying average of the top 10 players for today. They only registered a buying average of 5.30!
Where did NOW close today? It closed at 5.61.
When my top 10 players chart shows many players with tall green bars and the buying average of the top 10 players is either equal or a few ticks away from the closing price of the stock, that’s a confirmation that the overall sentiment of the top 10 players is bullish. Otherwise, I’d say that the top 10 players are still eavesdropping with each other’s next moves.
Top 10 Players’ Sentiment as of October 12, 2018
Trading participants of NOW with a 100% Buying and Selling Activity as of Oct-12-2018 at 03:30PM:
- 6 out of 80 participants or 7.50% of all participants registered a 100% BUYING activity
- 12 out of 80 participants or 15.00% of all participants registered a 100% SELLING activity
- Top 10 Players’ Buying Average: 5.3023
- Top 10 Players’ Selling Average: 5.3422
The psychological average price of the top 10 players as of Oct-12-2018 at 03:30PM is from 5.3023 to 5.3422.
Top 10 Players’ Sentiment – October 8-12, 2018
Trading participants of NOW with a 100% Buying and Selling Activity from Oct-08-2018 to Oct-12-2018 at 03:30PM:
- 8 out of 96 participants or 8.33% of all participants registered a 100% BUYING activity
- 6 out of 96 participants or 6.25% of all participants registered a 100% SELLING activity
- Top 10 Players’ Buying Average: 5.4657
- Top 10 Players’ Selling Average: 5.4649
The psychological average price of the top 10 players from Oct-08-2018 to Oct-12-2018 is from 5.4649 to 5.4657.
It’s an action-packed day today as can be seen by these 181 price bars on my Price-Volume Distribution chart.
The intraday low was 4.11 while the intraday high was 5.94.
I noticed a slight increase in volume vis-a-vis the number of trades at 4.50. I would say that traders did an intraday testing on whether other traders were willing to buy NOW at a higher price again or not between 4.50 and 5.00.
The intraday upward momentum snowballed from 5.00 to 5.90.
If you will plot the 5-minute intraday chart of NOW, you’ll see that it managed to stop the downward pull below 5.30 before 3:00 PM.
But, but, but, I told you before that you don’t need an intraday chart anymore because we already have the Price-Volume Distribution chart.
I’ll show you why.
What are the two longest price bars on the Price-Volume Distribution chart?
What’s the longest price bar BETWEEN 5.00 and 5.60?
It’s the mean: 5.30.
With our Price-Volume Distribution chart, it’s easier to see the most active price points or ranges. Hence, it’s easier and faster to make a decision at what price you should buy or sell stocks. I’ve explained this chart in the Quick Start Guide, too.
These proprietary tools I developed are very powerful.
But there’s one thing that I did not program them for.
What is it?
I did not create them to paralyze you and treat you like a human being who cannot make a disposition for yourself.
Yes, you can see the most active price points and ranges but you still have to decide where you should park your buy or sell transaction based on your risk tolerance.
Not because my Price-Volume Distribution chart showed that the biggest volume and the highest number of trades were registered towards the upper half of the chart, it doesn’t mean everyone can trade NOW on Monday. No! If you’re not a high-risk trader and if you’ve just opened your online stockbroker’s account a few months ago, observe for now and study more.
Tools are tools. They can help you make a decision but they can’t decide for you.
We pay attention to the quality of our response to our customers because mentoring is part of our EquiPicks service. In addition to this, we guide our customers on which stocks to buy and when to sell for long-term investing and short-term trading.
We’re here to help.