distributed every market day.
Communications (NYSE: SBC)
Market Call for November 5, 1999
Contributed by Mark Seleznov, TrendTrader.com.
The purpose of this Market Call section is to
educate readers in technical analysis patterns and indicators. As with all investment
information, you need to research information and consult your financial advisor before
initiating any strategies that are contained in Market Call.
Also, you must realize that as with all trading strategies,
opinions can change quickly depending on market conditions and developments.
This column tries to present historical examples, potential set
ups, and examples of entry and exit strategies.
It is nice when more than one technical indicator is present in a stock.
It is not unusual for a stock to have conflicting signals. This is
especially true with multiple time frames.
We are using a 60-minute bars in our short term trading
Each day, I use 4 major indicators to help with education and stock selection.
They are Moving Average Crossovers, MACD, Momentum, and On Balance Volume
Let's look at SBC Communications (NYSE: SBC)
From the middle of October, SBC was in a down trend as indicated by the
moving averages, MACD, Momentum and OBV.
Last week SBC was added to the Dow Jones Industrial Averages.
You can see from the chart below, the gap when it was announced and you can
even see the increase in price and volume before the announcement. Did
someone know that SBC was going to be added before the announcement?
The technical indicators all signaled a buy before the announcement and a
nice profit could have been made using crossing moving averages, Momentum
On Tuesday afternoon, a moving average Sell signal confirmed the MACD Sell
signal and SBC has been moving down.
Today, November 4, 1999, SBC is back to where it was before the
announcement and looks like it will continue lower on a break in the morning.
A Sell should have been executed Tuesday. However, I would exit SBC if long
on any weakness in the morning.
An aggressive trader can still short SBC on weakness with a stop at 52.
Do not exit or Sell short unless SBC opens lower in the morning.
Mark A. Seleznov is a General
Securities Principal and Managing Partner of Trend Trader, LLC, a NASD, SIPC broker/dealer firm located in
Scottsdale, Arizona. A professional trader for over 25 years, Mark was a Market Maker on
the Philadelphia Stock Exchange, a Retail Registered Representative, and futures trader.
Mark is an author and recognized expert in equity Day Trading. He conducts seminars in
Equity Day Trading and offers his firm traders training and support. If his firm holds any
positions in the public companies he writes about, it will be noted at the bottom of his
Market Calls is a daily syndicated column on trading by Mark A. Seleznov, Managing Partner
of Trend Trader,
LLC. For information on obtaining Market Calls for your web site,
newspapers, or publication, contact Trend Trader, LLC at 602-948-1146
Disclaimer: Trading in securities may not be suitable for
all individuals. Consult your broker or other professional to determine your suitability.
This is not an offer to buy or sell securities. The advice given above is of a general
nature and should not be taken as a recommendation to buy or sell the referenced security.