Below are the downside targets for Sea Limited (SE).
If you’re impressed with the increase of Tesla (downside target here) in the last few months then a look at Sea Limited should put that into perspective.
Since the name change of the company from Garena Interactive Holding in 2017 (cough), Sea Limited has outpaced Tesla on the upside.
Posted in SE, Speed Resistance Lines, SRL
Below are the downside targets for DexCom Inc. (DXCM).
DexCom Inc. has had a healthy increase of the last 2 years and requires a reset. When will that reset occur? We don’t know, however, we suspect that the conservative downside target is the best level to watch for.
Posted in DXCM, parabolic, Speed Resistance Lines, SRL
Below are the downside targets for Paycom Software Inc. (PAYC).
If extended to the IPO date in 2014, we would have generated much lower downside targets. In an effort to be reasonable about expectations, the targets have been set from 2018. The forecast is that PAYC will decline to the ascending level of $224.12.
Posted in parabolic, PAYC, Speed Resistance Lines, SRL
Below are the downside targets for Tesla Inc. (TSLA).
Parabolic increases rarely go unchecked. This typically means that a decline to the conservative downside target is the norm, at minimum. However, Tesla has had a history of defying the “norm” when it comes to price change.
Posted in downside, parabolic, Speed Resistance Lines, SRL, TSLA
Below are the downside targets for Luckin Coffee (LK).
The strong rise in the price from November 2019 to January 2020 is being matched by the current decline. We expect that the decline to the $25.78 level should be accomplished as a natural reaction to the prior dramatic increase.
Posted in LK, Luckin, Speed Resistance Lines, SRL
In reviewing the price history of Palladium and in light of the most recent parabolic increase, we have outlined the current increase in the price and compare it to the 1996-2003 rise and decline.
1996-2003
In the period from 1996 to 2004, the price of Palladium increased +837% and subsequently declined from the peak by -86.05%.
The chart above includes the Speed Resistance Lines (SRL) based on the work of Edson Gould. In this specific instance, the price of Palladium declined through all of the downside targets. In addition, the continued until it reached a low of approximately $150.50 or -58% below the $359.67 Speed Resistance Line.
In the following review of the most recent increase in Palladium, we’ll compare the 2016-2020 run-up to the increase from 1996 to 2001 to identify the signs of what might come in the price going forward.
Then v. Now
Technically Speaking
When looking at the price of Palladium in both periods, we have identified the most important points contributing to our analysis.
The start to our review is the first intermediate peak after the low. In the case of the 1996-2004 period, that first peak was at $397.50. For the period of 2016-2020, that peak was $1,119.90. The subsequent lows that followed, $272.20 and $877.80, helped to establish the downside targets.
Worth noting is the decline from the initial peaks to slightly below the mid-range downside targets before a continuation of the rising trend to the second intermediate peaks at $718.50 and $1,520.35, respectively. In both cases, the decline from the second intermediate peaks are situated around the conservative downside targets at $631.87 and $1,627.93.
In both cases, the parabolic move ensues after the second intermediate peak, which is a considerable distance from the level of the conservative downside target.
Conclusion
Because of the precedent set in the period from 1996 to 2001, we expect that the conservative downside target of $1,627.93 will be achieved.
We could consider it luck if the price of Palladium were to decline to the mid-range level of $1,189.03 or the extreme target of $750.13. However, if the period from 1996 to 2003 is truly a precedent setting period then it would not be surprising to see Palladium decline to $750.13 as a normal reaction to the parabolic increase.
Posted in downside, Edson Gould, palladium, parabolic, Speed Resistance Lines
The price of palladium has increased significantly since 2016.
Naturally, parabolic peaks mean that the price is nearing a top. The downside prospects are the only clear consideration at this point in time. Below are the downside targets for the Aberdeen Standard Physical Palladium Shares ETF (PALL) that we have generated based on the most recent peak. Continue reading
Posted in Edson Gould, palladium, parabolic, Speed Resistance Lines
On September 14, 2018, we said the following of the downside targets for AeroVironment (AVAV), when the stock was trading at $116.24:
“The conservative downside target of $62.26 is a lock in our view. To put this in perspective, AVAV would have to increase to $160.62 before the $62.26 level isn’t a normal ‘dip.’”
The numbers we based our downside targets on was with the assumption that AVAV could rise as high as $160.62, for a reasonable margin of error. Instead, AVAV peaked only two trading days later at $119.83 (the above chart has been adjusted to the peak).
The decline in AVAV has seen the stock fall as low as $49.54 on August 27, 2019, a drop of –58.65%. The most important element of the current decline is the ability of the stock price to remedy the preceding parabolic move. A drop of nearly-60% comes very close to fixing the previous disparity in the price.
From the August low, AVAV has managed to rally to the latest price at $61.81. The power of the reversal is highlighted in the fact that the stock price rose from the $49.54 level then achieved the $63.59 price. From the $63.59, the stock declined but could not achieve a price lower than $49.54.
The upside resistance levels are as follows:
Speculators (as opposed to Investors) should take these levels to be the points when the continuation of the upside will reverse to the prior low, as a re-test. Investors, basing their assessment on the fundamentals, can strategically enter positions breaking their intended investments in thirds or halves.
Posted in AVAV, Edson Gould, parabolic, Speed Resistance Lines, upside target
In our previous work, we have outlined the impact of dividends and the historical precedent related to the qualitative elements of Anheuser-Busch InBev (BUD). Why have we put so much focus on ONLY one fundamental element as it relates to a stock and its future prospects. As stated by Geraldine Weiss in her book Dividends Don’t Lie:
“The philosophy that the dividend yield of a quality company can reveal volumes about a stock’s future performance does not lend itself merely to a certain tax climate or a particular market cycle. It is a basic principal. one that serves as a faithful guide through even the most confounding stock market phases (page 10).”
Many argue that such a narrow perspective on esoteric points regarding the dividend doesn’t tell the whole story. Our writing on this topic since calling the bull market in 2009, and starting this site, highlights the exceptional consistency of the perspective that we have offered.
Price Reveals Fundamentals, Fundamentals Reveal Price
According to Charles H. Dow, co-founder of the Wall Street Journal and creator of the indexes that bear his name:
"The one sure thing in speculation is that values determine prices in the long run. Manipulation is effective temporarily, but the investor establishes price in the end. The object of all speculation is to foresee coming changes in values. Whoever knows that the value of a stock has run ahead of price and is likely to be sustained can buy that stock with confidence that as its value is recognized by investors, the price will rise (Dow, Charles H. Review and Outlook. Wall Street Journal. February 25, 1902.)."
With this in mind, we will venture into the indication that are provided by the activity of the price for Anheuser-Busch InBev.
Downside Speed Resistance Lines
Below are the Downside Speed Resistance Lines (SRL) for Anheuser-Busch InBev (BUD) covering the period from July 2009 to November 2019.
The downside targets based on the data from 2009 to the present are:
We can see that BUD has managed to decline through the conservative and mid-range targets. All that remains is the extreme downside target of between $44.48 and $47.70. The lack of historical precedent does not allow for the richer analysis of the price that we’d normally like to do. Such analysis makes for what we believe would be better interpretation of the price activity.
Three Steps Rule
In addition to Gould’s Speed Resistance Lines, there is the theory of the Three Steps Rule. According to Gould:
Our Three Step Rule (not to be confused with our Three Step and Stumble Rule, Which refers only to monetary conditions) has been helpful over the years in our attempt to project stock market moves and to anticipate stock market tops and bottoms.
Our Three Step Rule says: In any stock market move, up or down, large or small or in between, expect three steps but be prepared for a fourth.
It applies to large moves as well as small moves.
Three steps up in an advancing market and three steps down in a declining market usually exhaust the bullish potential accumulated at the bottoms and the bearish potential accumulated at tops- but sometimes there is a fourth step (Edson Gould Reports. Edson Gould’s 1975 Forecast. November, 1974. page 8. ).
We have included, in the chart above, the Three Steps (red circles). In this case, the third “step” cannot occur unless it is at some point below the second “step.”
Upside Speed Resistance Lines
Below are the Upside Speed Resistance Lines (SRL) for Anheuser-Busch InBev (BUD) covering the period from September 2016 to November 2019.
The upside targets based on the data from 2016 to the present are:
As with downside prospects there must be upside resistance. From the all-time low set in late 2018, BUD has managed to climb as high as $101.58. However, not achieving the $111.00 upside resistance and then falling below the $99.44 upside resistance level suggests, at minimum, a re-test of the $65.43 level.
Speed Resistance Lines are based on the work of Edson Gould who was famous for precisely calling market tops and bottoms and widely quoted in Barron’s throughout the 1970’s. How powerful are the indications provided by Gould’s SRL?
Among the many posting we have on the topic, our April 26, 2012 on the downside risk for Chesapeake Energy (CHK) titled “A Warning for Chesapeake Shareholders” suggested that although the stock was trading at $18.10, CHK could potentially decline as low $0.67 as a normal reaction to the prior peak. On November 12, 2019, CHK had a closing price of $0.67.
Posted in BUD, Edson Gould, Speed Resistance Lines, SRL, three step rule
Below are the upside resistance targets for the Shanghai Composite Index for both the short and long-term moves.
Short-Term Targets
Based on the price action since January 2019, the Shanghai Composite Index has conformed to the upside resistance targets ranging from 3,012.38 to 3,378.93.
The short-term upside resistance target determines market sentiment for achieving the 3,559.47. So far, the market appears on course to achieve a re-test of the prior low at 2,464.36. The theory of the re-test is known as a double top, or in this case a double bottom, as described by Charles H. Dow in 1901.
"Another method is what is called the theory of double tops. Records of trading show that in many cases when a stock reaches top it will have a moderate decline and then go back again to near the highest figures. If after such a move, the price again recedes, it is liable to decline some distance (Dow, Charles H. Wall Street Journal. July 20, 1901.)."
The expectation should be that after obtaining a new low or a new peak, the price will trend in the opposite direction and then re-test the prior extreme level. In this case, it is the 2,464.36. This makes the 3,012.38 upside resistance level a reasonable level for expectation on the way to the down from the current level as diagramed in the chart above.
Long-Term Targets
The most important factor to watch for is the long-term trend in the Shanghai Composite. The chart below outlines the long-term prospects for the index. Continue reading
Below are the downside targets for Roku Inc. (ROKU).
Our experience with all Speed Resistance Lines is that the conservative target is going to be achieved, no matter the reason. The targets are as follows:
Posted in downside, Edson Gould, ROKU, Speed Resistance Lines
Below are the upside and downside targets based on the work of Edson Gould’s Speed Resistance Lines. Continue reading
Posted in Crude Oil, Edson Gould, Speed Resistance Lines, upside target
Tagged members
From the stunning peak of $8,700 in April 2018, Swiss National Bank has declined –36.78% as of November 13, 2018. What might be different about this time, versus when SNBN was at $4,449 or $5,940 is that when the price declined it never achieved the conservative downside target of the Speed Resistance Lines [SRL].
| peak | extreme | mid-range | conservative |
| $8,700.00 | $2,900.00 | $3,657.00 | $4,414.00 |
| $4,449.00 | $1,483.00 | $2,240.00 | $2,997.00 |
| $5,940.00 | $1,980.00 | $2,737.00 | $3,494.00 |
The latest decline has hit the conservative downside target at $4,414 and is in the process of retesting that level, as seen below.
Watch the $5,500 level closely as a continued decline could have broad reaching impact on some popular tech stocks.
Posted in Edson Gould, SNBN, Speed Resistance Lines, SRL
On October 25, 2018, in after-hours trading, Amazon.com (AMZN) was trading down to the level of $1,664.00.
We’ve tried the Speed Resistance Lines on this stock in the past and it is one of the few that has not achieved the conservative downside target. In spite of previous failures, here we go with the minimum downside target for AMZN, let’s watch as it defies (again), our minimum target of $969.28.
Posted in AMZN, Edson Gould, Speed Resistance Lines, SRL, The Study of Failure
Below are the downside targets for Align Technologies (ALGN) based on the high of $392.98.
The price movement of ALGN from the 2008 low to the current level is staggering. This partially explains why the reaction is, and should be, devastating for those who bought the stock within the last several months. Our experience has been that the $156.64 will be achieved, at minimum.
Posted in ALGN, Edson Gould, Speed Resistance Lines, SRL