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by Koos van der Merwe
It is not what you feel that gives you profits in the market, it is what you see, and Barnes and Noble does look interesting.
Position: N/A
Koos van der Merwe
Has been a technical analyst since 1969, and has worked as a futures and options trader with First Financial Futures in Johannesburg, South Africa.
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CUP WITH HANDLE
Is Barnes & Noble.com Inc. Expecting More From Harry Potter?
07/28/03 10:25:51 AMby Koos van der Merwe
It is not what you feel that gives you profits in the market, it is what you see, and Barnes and Noble does look interesting.
Position: N/A
| A look at the chart shows a large cup and saucer pattern developing with the handle appearing to form a consolidation triangle. The rise on June 12 was caused by the announcement that pre-release orders for the book Harry Potter and the Order of the Phoenix were far greater than anticipated. |
| The expected profit windfall pushed the price from $1.73 to $2.98 over a period of six days. Since then it appears to be consolidating in what could be a major rise to a target of approximately $5.00 ($2.99 - 0.97 = 2.02 + 2.99 = 5.01). However, before this happens, the price would have to break above the upper triangle boundary, line BC on the chart below. This would give a very positive buy signal, but the price could meet resistance at $2.99, fall back turning the BC resistance line into a support line, and then possibly rise to retest the $2.99 resistance. A break above this level is a break out above the cup and handle formation, confirming the rise to the estimated target of $5.00. |
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| Barnes and Noble .com |
| Graphic provided by: AdvancedGET. |
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| Finally, do note that the RSI indicator is pointing downwards, with a possible buy signal at the 38 level rather than the traditional 30 level. |
| The share price also gave a JM internal band "buy" signal in June as shown on the chart, and has not given a sell, although traders would have closed positions on rising stops in the fall from the high at "B." An internal JM band, as showin in the chart above, is a 28-period simple moving average offset upwards by 6% and downwards by -6%. |
| I would not buy this share yet-- but it is on my watch list. As I wrote above, it is not what I feel, but what I see that is important and I am waiting for a very definite buy signal to be given, before I am tempted, one way or the other. |
Has been a technical analyst since 1969, and has worked as a futures and options trader with First Financial Futures in Johannesburg, South Africa.
| Address: | 3256 West 24th Ave |
| Vancouver, BC | |
| Phone # for sales: | 6042634214 |
| E-mail address: | petroosp@gmail.com |
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