Yeah, OK, the market's nasty. And your method -- and I hope you have a method -- isn't exactly working. Well, brother, been there, done that! More on that topic Wednesday.
And speaking of next week, Monday I'm going to address the difference between chart reading and trading. For background and assorted hints, see Friday's
As for today, plenty of interesting charts, plenty of silly comments. (The latter, compliments of yours truly.) Want me to comment on your chart? Send your request to
firstname.lastname@example.org. I'm here 24/7, 365 days a year!
Power to the PeopleSoft
Gary, I am new but would like to see what you have to say about PeopleSoft (PSFT) . Any info on this would be helpful as it's been killing me. -- Ben Saiki
Third Peak Wouldn't Be a Charm
Gary, What's your take on JB Oxford Holdings (JBOH) ? Aside from almost identical patterns in February to March and April to May, there appears to be congestion on lower volume, good support at 13 to 14 per share and a consistent 50-day simple moving average. Once the dust from May settles, is it ripe for a rise after Memorial Day? -- Steve Pike
Wait on Wet Seal
Gary, What gives with Wet Sealundefined? It just released its quarterly earnings and, as usual, they were up. Yet the stock has dropped at least 10 points in less than two weeks. It looks like a screaming buy. What do you think? -- Clarence Feinour
RX for Warner-Lambert Position
Gary, I bought Warner-Lambertundefined six months ago at 71 for a trade. When it was obvious that a trade was not possible, I started selling covered calls against it. I have done about $11,000 by selling and buying back in the 65 to 69 range. Have been using the 70 strike. What does the chart say? -- Branson Willis
Gary, How will extended trading hours on U.S. exchanges affect TA? It seems that a second session will have lower volume and be more volatile. Should we disregard it on the daily charts the same way as after-hours and overseas trading? Or we should combine data in one session? What are you doing to prepare for extended hours? -- Slava Chechik
I'm getting this question a lot, and I'll tackle it next Monday.
Gary, I've recently discovered your columns on
, and have been catching up on your archived ones as well. I've always related well to mathematical-based situations, so I'm enjoying learning more about your TA method. Being fairly new to the market, I'm trying to learn as much as possible about methods and systems, and I'm intrigued by the TA method. When doing a chart, I've noticed that you use varying time frames. What would determine your choice? For long term, I assume that a year or more would be optimum, but what about short-term trading (along the lines of a daytrader)? My trades so far have been small (100 to 400 shares), and I've been turning them in about three to six weeks. I do have some long-term stocks that are "parked," but I'd like to develop better skills on reading charts and timing the market for short-term trading. Could you check these charts: Sports Authorityundefined, Tandy (TAN) - Get Free Report or Dayton-Hudson (DH) ? I've considered them, but I'm not sure whether they'd be good choices. -- Ray Baldwin
Let me tackle the time-frame question first. For my own trading, I always use daily charts, and sometimes weekly charts. If you're doing daytrading, you'll want to use intraday charts, of course, probably five- or 15-minute charts. But, for my position trading, I always use the next time frame up -- in this case, daily charts.
If you're using a longer time frame, then simply scale up. Weekly charts work fine as a base, and then monthly charts as a check.
This discussion differs somewhat, though, from the chart discussions in this column. Since I don't know everyone's time frame, I try to look at the chart in a variety of time frames in order to give a good read on the overall health of the stock. Even then, though, what might look weak to me, might look strong to you, depending on your time frame.
As for charts, let's look at Tandy.
This Dish Needs Spice
Gary, What do you think of the chart of United Natural Foods (UNFI) - Get Free Report? It has come off a 52-week low. The improving Asian economy should help its earnings. It's a market leader in its industry. -- James McGuire
Cup Runneth Over
Gary, I have a very interesting stock for you to analyze. It's a small-cap stock by the name of Optikaundefined. Feast your eyes on the huge volume and price surge this stock had on April 24. I believe the recent pullback was orderly and occurred on low volume, but I'm concerned about the recent move up because the volume hasn't been very heavy. Since I regard you as the finest technician in the galaxy, I would be most grateful for your take on this chart. -- Todd Maushund
Gary B. Smith is a freelance writer who trades for his own account from his Maryland home using technical analysis. At the time of publication he had no positions in the stocks mentioned, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Smith writes five technical analysis columns for TheStreet.com each week, including Technician's Take, Charted Territory and TSC Technical Forum. While he cannot provide investment advice or recommendations, he welcomes your feedback at