MHJ - Michael Hill International.

[Major von Tempsky]

Did the chart predict the profit warning, he said, sotto voce....

[duncan macgregor]

MVT, The chart told me not to have shares in the company 10 months ago. Only the fundamentalists would be holding this stock at this time so let them worry about profit problems. macdunk

[Gryffyn]

quote:Originally posted by Major von Tempsky

Did the chart predict the profit warning, he said, sotto voce....

Note that P the issuer of said chart stated that it was not a stock he would want to be holding.

[Phaedrus]

Major, you should know by now that charts cannot predict the future. Nothing can. I am heartily sick and tired of trying to get this point through to you. Not only do you fail to understand what charts can't do, you also seem to be totally incapable of appreciating what charts can do. Specifically, with regard to MHI :-
The chart indicated a clear SELL on this stock at +/-$8 OVER A YEAR AGO. (Posted on 3/12/04, page 3 of this thread). Nicely timed eh? Where was your warning? Where was your advice to quit MHI?

11 days later on 14/12/04 I posted the words "With todays close of $7.80, MHI is now in a downtrend" (page 3 of this thread). That's a [u]DOWNTREND </u>MvT, those things it pays to keep out of - Capiche? Again, where was your MHI warning at around this time? (OVER A YEAR AGO) Look at the chart and you will see that [u]more than a year later that same downtrend is still in effect</u>. The 14/12/04 post turned out to be particularly apposite - why don't you read it?

Since that time, MHI has remained in a shallow downtrend and has also encountered resistance at $8.10 or so. (But then you don't "believe" in Support or Resistance do you?) Short-term MHI traders would have exited on the recent trendline break marked with a red arrow. I shouldn't have to point this out to you, but all this was of course well before the drop occasioned by the profit warning.

You see MvT, there is no need to even attempt to predict the future. All you have to do is react appropriately to significant price movements as they occur. This is what charts depict. Not the future. I doubt that you will EVER understand this simple point.

Charts got users out of MHI before the downtrend began. (See page 3)
Charts got users out of MHI before the meltdown.

That's all charts can do.
That's all charts need to do.
Get it?

Probably not!

[Gryffyn]

Wasting your breath P.

[Lizard]

To be fair Phaedrus, this would be a difficult stock to exit and enter on trendline breaks in any significant volumes, because the volumes traded are often quite low. The dip in early 2005 made me nervous enough to get out at prices of $8.05-$8.14 in April, but even with my relatively small holding, it had to be a well-timed sell order...

[duncan macgregor]

quote:Originally posted by Lizard

To be fair Phaedrus, this would be a difficult stock to exit and enter on trendline breaks in any significant volumes, because the volumes traded are often quite low. The dip in early 2005 made me nervous enough to get out at prices of $8.05-$8.14 in April, but even with my relatively small holding, it had to be a well-timed sell order...

To be really fair it is hard to sell shares in a good company. Pheadrus has his trend lines i have my time line run from my stop loss level. I would probabely have had a 15 pc trailing stop loss running on this one with a 20pc pa time line from that point. I cant be bothered to work it out as i am not an investor in MHI but that is what i would have done. I normally start with a 5pc stop loss then relax it in a steep trend when i buy my second lot. When a share goes sideways its nearly as bad as going down. You must also take into account dividends with your stop loss decisions. macdunk

[Snoopy]

quote:Originally posted by duncan macgregor

MVT, The chart told me not to have shares in the company 10 months ago. Only the fundamentalists would be holding this stock at this time so let them worry about profit problems. macdunk

Not all fundamentalists Macdunk. Here is what I wrote on sharechat in the latter half of 2004.

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In assessing the 'terminal value' of the company at the end of my valuation period, I have used the average P/E over the last eight years, which works out at 13.1. Note that both of these figures have gone up since we first started following MHI

The expected compounding rate of return on this share works out to be 4.4%. This is below the rate of return you would expect from government stock, which makes the added risk of holding a share to obtain this income stream not worth it.

The company of course is still fundamentally excellent. But Mr Market has priced the shares so high that MHI are going to have to roll out stores significantly faster than they have in the past - and profitably, to meet the expectations of Mr Market. If Warren owned this share he would be selling his holding while the price remained so far above fair value.

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I would have been out at $7.86, at a very similar price point to Phaedrus based on his charting.

SNOOPY

[Lizard]

Being "nice" MacDunk, and assuming you'd been smart enough to buy in mid-2003 at $4.20, then (not allowing for divis), your timeline would not kick you out until below about $6.62 at this point...

The TA's are out. The FA's are out and, right now, you are losing... [}]

[rmbbrave]

quote:Originally posted by Gryffyn

Wasting your breath P.

Just like his geography teacher was.