Are you late or early? It’s all a function of timeframe. Let’s look at ConocoPhillips (COP) for..
Discussed in this article: ConocoPhillips ( $COP )
Let’s look at ConocoPhillips ( NYSE:COP ) and here’s why; I want to talk about time frame, because it’s really important and I know traders get jigged out of stocks all the time. You buy late, you sell early, you sell late, you buy early, and basically it’s just a timing thing. Well what you have to do is figure out what the heck your time frame is.
Here’s what I’m talking about; this stock zigs a lot, and it zags a lot, but if you just want to draw some lines, the stocks in an uptrend. Here’s are lines along support, here’s three right there, it’s all lower left to upper right. We can look at it a different way though, high, high, highest high, oh, lower high. Now all of a sudden I’m going, could that be a left shoulder, a head, a right shoulder, could that be the neckline? Now we’ve got, we’ll say this is about 69.00 up to 74.00, that’s about a $5.00 move. So now we’ll say, okay the stock is breaking down below the neckline, we’ll call it 69.00, so we take the $5.00 from the high to the neckline, we subtract it from $69.00, you go ahead and do the math, you can count on your fingers while I just tell you it’s $64.00. So that would give us a downside target, if we look at the head and shoulder pattern, of $64.00, if it’s a head and shoulder pattern. That could work, you want to sell it if the stock falls below that level, and it looks like it’s going to.
So does that mean the move is over? Well, you look at the weekly chart and this thing has been pretty volatile, it’s actually been real stable here, and as I look at this, the blue line is the 200-day moving average, as I look at this all ConocoPhillips ( NYSE:COP ) is doing is coming down to a pretty decent buy point. So what do you want to do? Okay, what’s your time frame, if you’re looking to trade for three or four points this is not your time frame, go back to the daily chart. But if you’re kind of a buy-and-hold person then this is your time frame. So, you wait for the stock to come in a little bit more, watch how it behaves right around there, which also, by the way, is the lower Bollinger Band, that’s always handy because the last couple times its hit the lower Bollinger Band from above, that’s actually worked out pretty well.
So watch how it behaves around $67.00 or so, if the stock starts bouncing a little bit, forget about the head and shoulder one, just buy this pullback to the 40-week moving average and you’re going to do just fine.