Monthly Archives: September 2016

TGI

I added some more TGI yesterday at $26.96.

On the opening pop TGI  yesterday set a new high of $27.33 and on a break of that I will add more.

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This post has several things to teach new traders.

Let’s start with the two blue parallel lines you see on the chart. These are enclosing the price action after the pop up on 9/22. We will get to the tails in a few minutes.

This formation is called a bull flag. When you are in an uptrend, which is in question here because this is only the second day of a reversal, the buyers will stop for a time and the stock will trade sideways and slightly down.If the flag is slightly rising it is much more likely to fail and the stock goes lower. If I were not already in this stock I would not buy until it broke through $27.33, which is the high of the pop after the reversal on 9/21. The buyers that are in here now are probably shorts who are covering their position. If we break through $27.33 we should get a strong short covering rally.

Let’s move on to the opening bar of each day. In a stock with no new news a falling stock will very often pop up a few cents at the open. Conversely, a stock that is rising will often fall a few cents at the open. What this is is the market orders to be executed at the open. Those market orders allow the market maker free reign to do as they please with your order at the most volatile time of day. Bear in mind the MM (market maker) has tons of information that you don’t have access to or don’t understand the importance of.

So on a falling stock the MM  moves the price up a little and you (buy at market at the open orders) buy higher than yesterday’s close. He, meanwhile, shorts your buy and then lets the stock continue lower. He covers his short a little later and pockets the change. That 5, 10 or 50 cents may be on a few thousand shares or 100’s of thousands shares. Those are the little pops up or down (rising or falling stocks) that you see at the open. Because these are not informed trades I pay no attention to these tails when I’m drawing lines on my charts.

I am normally at the computer at the open every morning and it gives me confidence to see these little opening moves.

Dave C

 

TGI

Buys TGI small at $26.61.    See prior post today.

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I do not like to base a trade on a five minute chart. We do have a 5 minute cup & handle here though.

The problem is that TGI is already lower than I thought it would go.

If she goes higher than the bounce high of $26.90 tomorrow I will add to my position then.

TGI

Triumph Group, Inc. TGI is an OEM manufacturer of aircraft components. They design, manufacturer, engineer, overhaul, repair, and distributes aero structures worldwide.

Over the last year or so TGI seems to have had some execution issues but I am hearing that these are pretty much behind them now.

Deloitte’s 2016 Aerospace and Defense Sector outlook states that this sector should be bullish for the next 20 years so the business is there if TGI’s management has gotten their act together and can sign some major business to the books.

Dan Crawley was hired as CEO and President of TGI on Jan 4 this year. He has 32 years experience in the aerospace and defense industries and was last with Raytheon as the President of Raytheon Integrated Defense Systems, Inc.

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As you can see on the daily chart above the projected earning for FY 18 are $4.48. With the new CEO I assume that every negative thing that could be found has been thrown into the last couple of earnings reports, and this is pretty apparent with negative sales growth for the past year.

Using the worst projected earnings TGI’s of $4.48 current P/E is 5.96. If we use last years earnings their P/E is 5.27.

In 2013 TGI had a high of $85.50 and a low of $13.44 in 2009.

Currently we have strong support at $23.00 then $18.00, 16.20, 14.60 and finally $13.44.

I would be astonished if TGI broke $23.00 but I’ve been surprised before. Currently I am watching TGI daily waiting for a reversal signal because it is way oversold.

Initial target is $40.00. With an improvement in sales and profit $70.00 within 18 months.

Dave C.

 

CXRX

Sells CXRX at $7.42, minus 26 cents.

If I had not sold two lots of this already this trade would be a loser. With the prior sells I,m up 16 cents. Wahoo

Concordia under pressure early amid cautious blog post that highlights a UK Health Service Medical Supplies (Costs) Bill  (5.50 -1.11)
9/16/2016, 9:37:40 AM ET

The Bill would amend the National Health Service Act 2006 to put beyond doubt that the government can require companies in the statutory scheme to make payments to control the cost of health service medicines. These payments can be either instead of, or in combination with measures to limit prices directly or control their profits. The Bill would also allow the government to apply penalties for non-compliance and to recover any payments owed through the courts following a right of appeal to a tribunal. The penalties can be a single penalty not exceeding £100,000 or a daily penalty not exceeding £10,000. UK Release

  • “The government intends to seek further views from stakeholders on the statutory scheme and the information requirements after the Bill comes into law. We are currently anticipating these consultations to take place over the spring/summer in 2017.”
  • Courtesy of Briefing.com