A Wyckoff Student Notebook

I picked up some ABBV and one of Rock's finds, QSR, near the close yesterday. They both held up well despite the carnage to the Essenpee. QSR tested support and the weekly traditional pivot as expected. The selling down to the test appeared to be low-quality, low volume, no big guys appeared to be selling.

QSR 30-min bars:


$1-box by 3-box-reversal Point and Figure:

 

Sold QSR for $10 gain with commissions...a TR set up with an upthrust this morning. Will buy back at more favorable price.

5-min bars:

 

Yep, it's not exactly a ball of fire today, it looks heavy. After earnings it gapped over the August traditional pivot at 11.54...right down there in gap-fill territory. I'm glad I got out on Fryday. I believe the CEO/Pres. and a VP both had big sells on Monday.

 

As I recall you have lots and lots of time and besides that, I think you're playing with the casino's money anyway.

I didn't mean to over-emphasize the CEO/Pres and a VP selling on Monday but at the same time I don't like it. I can't help but remember the mantra of Wall Street that says it only matters when insiders buy; because they could sell for any reason, like buying a vacation home, blah, blah, blah. Maybe, but my gut says that's a wagon load of sheeple manure. I can't count the number of times I've heard the Buy & Holder's parrot that crap because their life hangs in the balance on every trade they make.

 

QSR is bucking the Essenpee. I got back in yesterday on what I thought was a test of a spring, but alas the spring persisted. I believe this morning the spring is confirmed.

10-min bars:

 

Using 10 minute data and a 10-cent box by 3-box-reversal PnF, I'm getting a short term projection on QSR to 77.70 which is close to testing the post ER high of 77.80. I might take profits there and buy back again once it builds more short term cause. The longer term projection is for $132.

EDIT: Correction, it has short-term cause to 78.30.

10-minute bars:

 

Here's the 10-cent-box by 3-box reversal PnF using 10-minute data. For short term PnF work it would probably be better to use a 1-box reversal chart except that TradingView does not plot 1-box-reversal charts correctly. I found that out after I paid for the "pro" service in order to get intraday PnF charts. Since a new column is started after the price reverses by the specified number of boxes, the 1-box-reversal can leave a single "X" or "O" in a column and that is the way TradingView plots it, but the 1-box-reversal is a special case where it should not leave only one character in a column and instead plot an "X" and an "O" in the same column. Stockcharts.com get that right, but not TradingView. So far now I'm just using a smaller box and a 3-box reversal. I would appreciate anyone interested in PnF work to go into TradingView and click on the "?" in the lower right corner and go into the "Vote for Features" page and search for "point and figure" and vote for the several threads calling for a fix to the 1-box-reversal error. Thanks.

 

Okay, so here is 10-minute data with an 8-cent box which produces enough definition to pick out the Last Point of Support (LPS), the point of support just before it rallied out of the trading range. With that I get a projection to near $80. We'll see.

EDIT: For later analyses: a less conservative count back to the PS gives 19 columns of cause and a price projection of $80.80.

10-minute data, 8-cent-box by 3-box-reversal:

 

Looking at the longer-term picture, $80 appears realistic. $80 would be right at the oversold line of the uptrend channel for this week.

Weekly bars:

 

Well I improved my position some in QSR but I wished I'd bought more this morning after the spring was confirmed or at the LPS. It's a classic case of an SOS after the LPS now, they won't allow the shorts to get out or new longs to get in without paying up. The volume is relatively light indicative of the CM having most of the shares locked up (no weak hands, no supply, ease of movement is up).

Congrats on NVTA. On TWTR have you done a price projection lately? I've been ignoring it but it looks like it has built quite a lot of cause.

 

So I decided to hold QSR another day or two. It closed near the HOD above 77.80-support and I'm thinking the $80 [79.84] short-term target has merit. It will become short-term oversold by bulging above the short-term trend channel, but that may make some sort of sense since it is so close to hitting the long-term oversold line at 81.50. We'll see what happens in the $79 area...one step at a time.

I'm long at 75.90 but the trading mistake I made is not buying more on the run-up to the top of the range once the spring/terminal shake-out was confirmed in the Jump-Over-the-Creek (JOC) area or just after the Last Point of Support (LPS).

10-minute bars:

 

^ Hmmm, I'm seeing 435k shares at 78.01 at 35 minutes after the close then 100 shares at 84.9999 at 2 hours 48 minutes after the close. Don't know what to make of that unless it's some sort of fat finger error but not likely at four 9s after the decimal. Maybe it's some sort of marker or signal.

 

It appears something is going on but I don't think it will open the regular session at $84.9999 with only 100 shares traded at that price in the extended session. There was a large block of 435,600 shares at a price of $78.01 at 3:35pm CDT, then the 100 shares at 84.9999 at 5:48pm CDT. Maybe that 100-share trade was a mistake, maybe somebody was careless and entered an extended hours "market" order instead of a "limit" order, or maybe the machines are sending messages to one another. Which sadly reminds me of how markets will become almost instantly redundant at the inception of AI (when Skynet becomes self aware). Of course it won't matter as we'll all become redundant too...our modern-day tower of Babel....oh cheer up, the rich guys at Google and Amazon have everything under control.