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Tuesday, May 15, 2012

AVP A Red Herring for PWRD?

What's happened to AVP today is what I fear for and what stopped me from going aggressive with PWRD.  The steps AVP took:

  1. Cup with handle pattern.
  2. A huge volume gap up.
  3. Consolidate nicely above the 23.6 Fib level.
  4. Gap fill and support at 200 day MA and 50 Fib
  5. Gap down after earnings.

Take a look at the PWRD chart:

It, too, started with a nice cup with handle pattern, nice huge volume gap up, consolidation at the 23.6 Fib, support at 200 day MA.   I'm already leery of the impending gap fill at the 50 Fib.  Also, guess what?   Earnings are only 5 trading days away next week.  One can't help but envision a similar outcome as AVP.  Otherwise, the big picture as per my original post is still in play in my opinion.

I hold a token 200 shares of PWRD.


  1. This worries me as well! i was long PWRD since March, got in $11.97 it went up to mid $16s & i did not sell..i held on for dividend -stupid me- now its under what i paid for it and i'm actually in the RED...i even increased my position yesterday. The stocks fundamentals , P/E & all that is amazing..but the trend is not!

  2. It sucks to turn a profit into loss. But even professional fund managers have that happen to them. Just ask Dr. Fly with his YELP positions. Anyway, that's why I like to sell 1/3 or 1/2 of "joy", which I can always reload if prices retreated like PWRD did.

    One good sign is it didn't get trashed along with the general market per se. Earnings is apparently more of the focus as it's only a few days away. Good luck!

    PS. PWRD is somehow "immune" because of the impending earnings, but in bear market, setups don't work very reliably at all. Look at AMZN and GOOG last week (week of 5/13/12).