I will add no pricing models to the chart of PG&E Corp. (PCG) - Get PG&E Corporation Report at this time. I just want you to take notice of what news events can do to performance and why, in my opinion, it is often best to avoid a name until you know the news is all out and the market has absorbed that news, even if sometimes that means giving up some potential gain. Impulsive behavior is counter-disciplinary, and I think will hurt a trader more often than not.
You can see here incredibly weak relative strength, and an ugly moving average convergence divergence MACD. There was indeed some positive money flow at Thursday's lows. Still, that "death cross" that the name experienced as October turned into November still looms large. There is nothing on this chart suggesting anything positive just yet. One last thing -- check out the volume bars. Much higher on the selloffs. Much smaller on the few up days that we've seen. Very telling on sentiment.
(This is an excerpt from Stephen "Sarge" Guilfoyle's Morning Recon, which now appears exclusively on Real Money, our premium site for active traders. Click here for a free 14-day trial and receive Morning Recon every day, along with exclusive columns from Jim Cramer, James "RevShark" DePorre, technical analyst Bruce Kamich and more.)
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At the time of publication, Stephen Guilfoyle was long APA, SLB, although positions may change at any time.