Sunday, August 06, 2006

Breakdown of leading stocks


In the weekend IBD edition (Aug 7, 2006), the investor education section takes a close look at the breakdown of a market leader, Goldcorp (GG).

I'm posting this because of the similarity the chart has with the ATI chart, which I just shorted. Notice the bearish divergence or wedging indicated by point 3.

Here's a quote from the article, "When leading stocks start breaking down after huge run-ups, that often signals a shift in market direction."

I think ATI is a much better short because it is more dependent on the economy. With inflation still on the rise, gold might resume its climb and bring GG right along with it.

2 comments:

Becky said...

Good luck with your short! I hope you make lots of money $$ =) Miss you...xoxoxo

Paul Stiles said...

Thanks Becky. When are you going to buy/sell something? Better yet, why don't you give me your money to manage? LOL!