the internet and social media is amazing. we are ALL connected …
we found each other thru health care and … he’s an avid trader.
so from time to time we meet on Skype and talk Health Care (hint hint – radical innovation is occurring) and the market. I’ve “seen” bits and pieces of KMI on my Twitter feed and everything but when someone like Joe asks me to check it out (He’s a “health care” guru) I take it seriously.
so, he’s also a budding PATTERN recognition trader (I’m bringing him away from the dark side of fundamentals (I jest)) and he asked me to break KMI down in what I SEE and not believe.
- it comes down to PROJECT (basic AB=CD suffices), EXTEND (extend retracements off IMPORTANT lows), RETRACE and IF/WHEN all the numbers come together you decide to take the investment opportunity OR not.
- throw a momentum oscillator on there – and if you have divergence in the direction of the pattern – it helps.
don’t know what the heck is going on w/ KMI but we do have some “music/math/geometry” coming into play …
AB=CD – the basics of measured moves.
find – to the best of your ability- the KEY highs/lows of a march either UP or DOWN. Your eye will train to it … but this “key low” is easy to see – EXTEND off that low using sacred geometry, music, Fibonacci. guess what, the numbers come in around 14. Note, where the 1.618 extension comes in … put your STOP, if trying to go long, below there
we can’t really retrace because we have blown thru the lows after the IPO.
Some recommend using “zero price”- which works- but I don’t think it’s necessary in this case. so let’s do some square root targets and you’ll find that 1.5 trips around the wheel is around 13.50 and you’ll also see with some basic TIME cycle analysis we are working on a 90 week cycle.
folks we hit that cycle this week …
so, as a PATTERN recognition investor:
- we have a bunch of math coming in around 13-14
- we have a time cycle coming THIS WEEK and have found support .. so, risk a 1 or 2 and go for it?
- what makes me “beg of caution” … STRAIGHT DOWN and when that happens patterns usually fail.
it’s all probability …but 13-14 looks “OK” to nibble on a long w/ a close stop? yes/no?