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The reason why traders are flocking on Sterling Construction Co. Inc. (NASDAQ: STRL)

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In the spirit of strong objective analysis, we are going to take a close look at Sterling Construction Co. Inc. (NASDAQ: STRL) from a technical chartist point of view today.

In short, technical analysis assumes that all publicly available facts about a stock are already discounted by knowledgeable buyers and sellers. And it is from there that the real work begins: examining the stocks behavior on the chart.

As such, we will begin with a quick check of the primary oscillators: the 14-day Relative Strength Indicator (RSI) and the 20-day fast stochastic. Both of these measures report on the degree to which a security is overbought or oversold ie, whether it has gone too far too fast in one direction or the other, and some kind of mean-reversion is called for. In each case, an indicator score of above 75 is considered overbought, while a score under 25 is considered oversold. In the case of Sterling Construction Co. Inc., the 14-day RSI stands at 79.59%, while the past month of action shows a score of 74.61% on the fast stochastic.

Well, what if we now look away from mean-reversion and towards the concept of trend That comprises our next step. To do this, we will start off by examining the most common systematic technical method of determining the direction of long-term trend in a stock: moving averages.

In the most basic sense, we can see that STRL has recently been exhibiting a bearing on the chart that suggests an overall bullish mode of behavior. This read comes from a look at the relative positioning of the 50-day and 200-day simple moving averages: if the 50-day is trading above the 200-day, momentum is to the upside making a bull case for trend; if the 50-day is trading below the 200-day, momentum is to the downside, making a bear case for trend. In this example, that system makes a bullish case, which naturally implies a positive money flow scenario for the stock.

So, we’ve spent some time looking at price as a factor. But what about volume In fact, many technicians view volume as more important than price. Volume defines the total level of participation involved in a stock. Its a coefficient of meaning that should be metaphorically multiplied times price action to equal conviction. In this case, we want to examine relative volume measures to get a feel for interest in the stock of late. Right now, this stock has been showing weak relative volume, which indicates lack of interest among those making a market for shares of the stock.

Next, we will turn to key levels. We always like to start this with a look at the key Fib levels. Fib refers to Fibonacci, which is the number series that works toward a ratio limit of the Golden Ratio, often found as a key in nature as well as markets. In this case, the critical 38.2% level drawn off the 52-week high of $18.48 sits at $13.76. STRL also has additional resistance above at the stocks 200-day simple moving average, which sits at $ 11.26.

While price action, trends, and volume are important, for traders, volatility may be as important as anything in defining the potential opportunity in a stock. Hence, we want to take a moment and consider this stocks overall range of movement, as well as its relative performance.

STRL has moved $+2.40 over the past month or so. Over the trailing 100 days, the stock is outperforming the S&P 500 by 57.94%. This movement has come on a less volatile bearing from one day to the next relative to the broader market, according to the stocks 36-month beta. Similarly, we can see that the stocks recent action has come on a historical volatility score of 57.28%. To get that score, one has to take the standard deviation of returns for a random trading input assuming buying the stock at a given average price during the specified period.

On a more basic level, one might look at the 20-day ATR as a percentage of its 20-day moving average. That measure gives us a volatility score of 4.76%. Naturally, we will continue to keep close tabs on the stock and update this picture again soon.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

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How is Orexigen Therapeutics Inc. (NASDAQ:OREX) Executing its Strategy?

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Well-rounded due diligence on a stock should take into account a basic analysis of core company trends such as top-line and bottom-line performance, margins, analyst views, cash flows, and overall balance sheet health. But that’s not all. One must also take a dispassionate, professional survey of a stocks technical characteristics.

For that, we must turn to the chart. Today?s object of technical analysis is Orexigen Therapeutics Inc. (OREX).

We will start our analysis by examining overall direction of trend. In the most basic sense, we can see that OREX has been working in a bearish posture on a larger timeframe, as indicated by the relative positioning of the 50-day and 200-day simple moving averages. In other words, if the 50-day moving average is trading above the 200-day, it is traditionally seen as a bullish chart trend. Conversely, if the 50-day moving average is trading below the 200-day, it is traditionally labeled a bearish trend or bearing. As noted, for OREX, that adds up to a bearish designation the main point being that we have money flows leaning in a generally negative direction for the stock.

Next, we will turn to our analysis of the primary oscillating indicators to assess the degree to which the stock is stretched in its movement at present. The key tools for this analysis are the 14-day Relative Strength Indicator (RSI) and the 20-day fast stochastic. In each case, the point is to measure overbought or oversold behavior ie, whether the stock has gone too far too fast in one direction or the other. If we see a score above 75 (overbought) or below 25 (oversold), history suggests one is wise to expect some reversion to the mean. For OREX, we can see that our 14-day RSI shows a score of 65.42%, while the 20-day fast stochastic reports a score of 66.00%.

Next, we will turn to key levels of interest on the chart, with an emphasis on Fibonacci retrace points, range extremes, and major moving averages. In this case, the critical 38.2% level drawn off the 52-week low of $0.79 sits at $2.27. OREX also has additional resistance above at the stocks 200-day simple moving average, which sits at $ 2.05.

We also want to look at relative performance and overall volatility scoring to understand value and risk in play. OREX has moved $+0.11 over the past month or so. Over the trailing 100 days, the stock is underperforming the S&P 500 by 47.62%. This movement has come on a more volatile bearing from one day to the next relative to the broader market, according to the stocks 36-month beta.

Similarly, we can see that the stocks recent action has come on a historical volatility score of 101.27%. To get that score, one has to take the standard deviation of returns for a random trading input assuming buying the stock at a given average price during the specified period. On a more basic level, one might look at the 20-day ATR as a percentage of its 20-day moving average. That measure gives us a volatility score of 10.89%.

Finally, we?ve spent some time looking at price as a factor in many forms and from many angles. But what about volume? Notably, many chartists see volume as more indicative for conviction in bearing or pattern than price measures, averages, or oscillators. Volume records the true degree of participation involved in a stock. If price pattern is like a word written on a word processor, volume is like the font size and punctuation. In this case, we want to examine relative volume measures to get a feel for interest in the stock of late. Right now, this stock has been showing strong relative volume, which indicates interest among those making a market for shares of the stock, and that should be seen as a key factor in drawing conclusions about your level of interest as well.

That wraps up todays analysis, but we will be sure to check back on this stock again soon.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

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TOP Ships Inc. (NASDAQ:TOPS) in a temporary turn?

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In the spirit of strong objective analysis, we are going to take a close look at TOP Ships Inc. (NASDAQ:TOPS) from a technical chartist point of view today.

In short, technical analysis assumes that all publicly available facts about a stock are already discounted by knowledgeable buyers and sellers. And it is from there that the real work begins: examining the stocks behavior on the chart.

As such, we will begin with a quick check of the primary oscillators: the 14-day Relative Strength Indicator (RSI) and the 20-day fast stochastic. Both of these measures report on the degree to which a security is overbought or oversold ie, whether it has gone too far too fast in one direction or the other, and some kind of mean-reversion is called for. In each case, an indicator score of above 75 is considered overbought, while a score under 25 is considered oversold. In the case of TOP Ships Inc., the 14-day RSI stands at 37.30%, while the past month of action shows a score of 8.23% on the fast stochastic.

Well, what if we now look away from mean-reversion and towards the concept of trend That comprises our next step. To do this, we will start off by examining the most common systematic technical method of determining the direction of long-term trend in a stock: moving averages.

In the most basic sense, we can see that TOPS has recently been exhibiting a bearing on the chart that suggests an overall bearish mode of behavior. This read comes from a look at the relative positioning of the 50-day and 200-day simple moving averages: if the 50-day is trading above the 200-day, momentum is to the upside making a bull case for trend; if the 50-day is trading below the 200-day, momentum is to the downside, making a bear case for trend. In this example, that system makes a bearish case, which naturally implies a negative money flow scenario for the stock.

So, we’ve spent some time looking at price as a factor. But what about volume In fact, many technicians view volume as more important than price. Volume defines the total level of participation involved in a stock. Its a coefficient of meaning that should be metaphorically multiplied times price action to equal conviction. In this case, we want to examine relative volume measures to get a feel for interest in the stock of late. Right now, this stock has been showing strong relative volume, which indicates interest among those making a market for shares of the stock.

Next, we will turn to key levels. We always like to start this with a look at the key Fib levels. Fib refers to Fibonacci, which is the number series that works toward a ratio limit of the Golden Ratio, often found as a key in nature as well as markets. In this case, the critical 38.2% level drawn off the 52-week low of $0.17 sits at $17,877.70. TOPS also has additional resistance above at the stocks 200-day simple moving average, which sits at $ 101.58.

While price action, trends, and volume are important, for traders, volatility may be as important as anything in defining the potential opportunity in a stock. Hence, we want to take a moment and consider this stocks overall range of movement, as well as its relative performance.

TOPS has moved $-0.05 over the past month or so. Over the trailing 100 days, the stock is underperforming the S&P 500 by 80.62%. This movement has come on a more volatile bearing from one day to the next relative to the broader market, according to the stocks 36-month beta. Similarly, we can see that the stocks recent action has come on a historical volatility score of 122.81%. To get that score, one has to take the standard deviation of returns for a random trading input assuming buying the stock at a given average price during the specified period.

On a more basic level, one might look at the 20-day ATR as a percentage of its 20-day moving average. That measure gives us a volatility score of 71.43%. Naturally, we will continue to keep close tabs on the stock and update this picture again soon.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

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A Big Picture Update on Helios & Matheson Analytics Inc. (NASDAQ:HMNY)

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We turn our attention to the charts today. Technical analysis. It?s the artistic side of the analysis. Here, we deal with lines and angles and patterns. Here, we try to listen to the market; to hear its opinion of a stock, quite independent of the seeming facts of the business. Here, we look to paint a picture, as it were. Todays subject in this exercise is Helios and Matheson Analytics Inc. (HMNY).

Let?s start with a quick evaluation of relative volume measures. Here, we want to examine the degree to which traders, investors, and money managers are more or less interested over the past month in transacting in this security. At this point, this stock has been showing weak relative volume, which indicates lack of interest among those participating in the market for shares of HMNY over the past month. That sets us up to look at relative performance of the stock along with range and volatility measures. This boils down to the concept of what is known as ?beta?.

First off, we can readily state the facts on relative performance. HMNY has moved -4.24 over the past month or so. Over the trailing 100 days, the stock is underperforming the S&P 500 by 62.84. As to the point of beta, we can see the stock has been generally moving less than the rest of the market on a day to day basis. That is according to the 36-month beta score. Another way to look at this is through taking the standard deviation of returns calculated as representing a hypothetical buyer of the stock at a random point at a given average price during the specified period. That gives us a historical volatility score of 158.79%. Finally, in this class of data, we can look at the 20-day ATR as a percentage of the 20-day moving average, which gives us a natural volatility score of 13.25%.

Now, it?s time to look at trend and extent of movement. From a certain point of view, these are the natural opposites in technical analysis. On the one hand, we know experienced traders and technical manuals teach us that ?the trend is your friend.? However, at the same time, we know it?s wise to fade extreme, overdone movement. That posits a natural tension for analysts, and unfortunately, the best we can do is to look at the facts.

In the first place, the broad impact of money flows should be viewed through the tried-and-tested lens of moving average analysis. In this case, we look at the relative positioning of the 50-day and 200-day simple moving averages. In other words, if the 50-day moving average is trading above the 200-day, it is traditionally seen as a bullish chart trend. Conversely, if the 50-day moving average is trading below the 200-day, it is traditionally labeled a bearish trend or bearing. For HMNY, that adds up to a bullish designation, which suggests that flows have been working in an overall positive direction on the chart.

To counter that notion, we now turn to a look at mean reversion oscillators. Our key indicators of note attempt to score the action as to whether or not a security has pushed too far too fast, leading to a likelihood of some kind of reversion to the mean movement becoming highly probable.

There is a host of oscillating indicators that can offer up such an analytic perspective. We have learned to rely most on RSI and stochastics. Specifically, we look at the 14-day Relative Strength Indicator (RSI) and the 20-day ?fast stochastic?. For both of these measures, if we see a score above 75 (overbought) or below 25 (oversold), history suggests one is wise to expect some reversion to the mean. For HMNY, the 14-day RSI shows a score of 34.96%, while the 20-day fast stochastic shows a score of 4.25%.

We close todays analysis with a quick check of key levels. For our means, we like to quickly check the key Fibonacci retracement zone as well as the primary institutional long-term moving average (the 200-day simple average). In the case of is Helios and Matheson Analytics Inc. (HMNY), the critical 38.2% level drawn off the 52-week high of $38.86 sits at $24.86. HMNY also has additional resistance above at the stock?s 200-day simple moving average, which sits at $ 6.84.

Hopefully, this analysis has offered up some useful perspective. We will catch up with this stock again soon.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

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