ASOS have dropped quite significantly in the past week for no particular reason and I view this as the perfect opportunity to invest as I can see them bouncing right back up to the 5.50p mark in the next 2-3 weeks. STRONG BUY!!

Slightly different observation today. SP down again, note that the SP now intersects the 50EMA in a downward trend, (sell signal). Last time this happened, the SP contrarily rallied at 48p. Additionally the SP is just touching the lower Bollinger Band indicating ASC are now oversold, previously the SP rallied at the same level as before. Tomorrow will be a defining day for the ASC in the short term. If the SP fails to rally, I believe the Support at 45p will be tested.

regards

PTH

ptholden

The Bollinger Band looks fascinating - source of decent write-up (or short explanation)? Reasonable volume at 1M; 43/57 B to S which wouldn't seem to justify a 3p mark-down. Volumes proportionate; the price swings suggest the mm's keep themselves short of stock and aim to balance buying and selling. Still think it would be odd if the 45p level were tested as there has been positive trading news since then. Mind, I would be happy to rebuild my stake around that price.

Regards, Eric

Eric,

Borrowed this explanation from another site, (I'll post the URL if interested). As you can see from the chart the thoery can easily be applied. What id doexn't say is that a stock may be considered to be oversold when in the limit of the Lower Band, (or below) and vice versa. Got that from somewhere else but can't remeber where!

Bollinger Bands measure volatility by placing trading bands around a moving average. These bands are charted two standard deviations away from the average, so as the average changes, the value of two standard deviations also changes. This value comprises the Bollinger Band Width, representing the expanding and contracting of the bands based on recent volatility.

During a period of rising price volatility, the distance between the two bands will widen (BB Width will increase). Conversely, during a period of low market volatility, the distance between the two bands will contract (BB Width will decrease).

There is a tendency for bands to alternate between expansion and contraction. When the bands are unusually far apart, that is often a sign that the current trend may be ending. When the distance between the two bands has narrowed too far, that is often a sign that a market may be about to initiate a new trend.

Regards

PTH

ptholden

Many thanks! Fascinating! I take it that BB20 is taking a 20 day period; that would seem to be OK giving you the effect of the last 4 weeks trading. Interesting how ASC actual price and the upper bound closely track each other on the way up. What's the logic behind the oversold signal on breaking the lower band/bound?

Regards, Eric

Eric

Rather than me waffling on about TA, and probably being a tadge simplistic, have a look at this site.


http://stockcharts.com/education/IndicatorAnalysis/indic_Bbands.html

regards

PTH

eric , central tendency.

Bollinger Bands are at their best when used in conjunction with Candles. Unfortunately it is not possible at the current time to look at ASC on MoneyAM because of an enormous data spike. which flattens out the chart. (I have asked MoneyAM to ask the data supplier to remove the spike...we will see.) Meanwhile the theory states that you can count on 85% of the price action taking place within the BBands and if the price is pushed through the envelope there is only a 15% chance of the price staying there. So it is a very good way of setting good entry and exit positions. Re ASC today, I agree with an earlier poster that tomorrow will be interesting....but for me, a drop down in the price will allow lots of topping up, so that anyone who is brave and goes LONG will reap the rewards in the months to come. There is nothing wrong with this company in any shape or form....it just needs time and newsflow.

Thanks folk! Mind, I have a natural attraction to going against the flow as johngtudor knows from Earthport bb. Couldn't agree more with you though, John, on the ASOS assessment. I see it as a good test of the charting method rather than the other way round.
Eric

John

I agree with your assessment that there is nothing wrong with ASC, but IMHO the SP is 'overheated' and will retrace to a lower level. My earlier posts / comments are there to see. My interest now is to what level the SP will drop and to identify an entry level if appropriate. Obviously I would wish to choose the lowest possible point without entirely missing the boat. My gut feeling is that we will see a recovery tomorrow, and perhaps for a short time thereafter, but after that we will have to wait and see. I find the Chartist approach quite interesting and informative, much more fun, (and easier to understand), than fundamentals. Looking forward to tomorrow.

Regards

PTH

I do not have any doubts about the long term value of ASOS but it will be interesting to see if it can put together a strong run over the next few days. Iif not I can see it pausing for breath around this level as I would think we could be short of news up until christmas.I think if it went as low as 50p I would have to buy some more

Evening all

Well, just for once I made a correct call yesterday evening, so feeling a little pleased with myself! 45p is staved off for the time being. I agree with Willfagg, in that I suspect the SP will trade sideways for a little while now. If after that period and no news / other information is forthcoming it will commence to slide again. I still expect Support at 45p to be tested, which may become my entry point. Interesting that someone on a rival BB, stated that the'psychological' support level of 50p may be tested. What on earth is a 'psychological' support level? load of B******s if you ask me!!

regards

PTH

ptholden, willfagg et al. (sorry to call other readers al!)

A lot of interest in the short-term prospects for the ASOS price. I don't think any reader doubts the potential strength of the share price in the light of expected trading levels over Xmas and beyond. The key question is when to buy and at what price. I think my remarks are directed to my friend PTH who has been very helpful with his graphs, etc.

First, my own history in the share which helps to explain my current actions. I bought at prices between 23p and 32p in March and April, building up a very much overweight holding which accounted for more than half of my total investment. I took some profits on the results during July only to buy back in August when the trading statements revised market expectations. It is interesting that the purchases on August 10th were at 41p although the end of day price was never below 46p - an indication of the volatility of the share price and the need to watch intra-day price movements. I have recently been taking profits at prices between 55p and 64p not primarily to lock in profits but to free funds for short-term stakes in other shares. I have taken profits of about 22K and have a paper profit of about 20K on current holdings.

Generally, my attitude is very like that of willfagg. I have been prepared to dilute the holding rather than have the funds relatively inactive for a couple of months. This is a risk in itself, given that positive news could rush the price ahead at any time - however, I see no reason why ASOS should want to blow their trumpet for no real reason. Nor do I see the price coming back much more. The expectation is already higher than the trough in August due to the AGM statement. There appears to be a current contest (last 2 days) between bears and bulls. I have three main conclusions, particularly for PTH. First, it is one thing for me to have, probably temporarily, diluted my holding, it is quite another not to be in the share at all. The downside potential now must be very small; against that is a very significant upside, whatever your analysis. Second, if buying, I would buy on intra-day weakness, for instance you could have bought at 52.74p for a few minutes early this morning. Having said that, the gains could be marginal against the risk of losing out a major rise. Third, when my funds which are otherwise occupied on a short-term basis become free, I will almost certainly increase the ASOS holding at the then price. Good luck!

Eric

Eric,

I actually agree with your three points, it would be hard not too! Obviously I maintain an interest in ASOS, why else post? I continue to look for an entry point, and have thus far saved myself approx 13p by not rushing in. The trick of course, is to judge the moment as best I can, otherwise I will not have saved anything! Unfortunately funds remain elusive at the moment and are tied up in relatively longer term investments, when actually I have discovered I am probably a short to medium term investor. I have a tough call to make tomorrow to which may swell the coffers. Ho Hum, decisions, decisions!! But whatever, the Golf Course will be visited.

regards

PTH

pth

I hope you won that fortune on the golf course! The ASOS share price, in the meantime has in fact bounced off the Bollinger Band - fascinating! Strong buying early on; subsequent sporadic selling still left ASC in positive territory. An exciting day in Yoomedia (YOO) and I can't switch funds back yet-a-while; I am really wanting ASC to mark time for a bit, or ease somewhat, but that seems increasingly doubtful.

good luck

Eric

Eric,

Quite an atrocious game of golf from yours truly, so not a particularly happy bunny this evening, never mind there's always tomorrow. Following my post last night, I had a look at the RSI for ASC and realised that they have never dipped below the 30 level and in fact have always bounced from that level when tested, interesting. As you say, doubtful now whether it will mark time, I think yesterday was the tester and thus far ASC has passed with flying colours, and as you have stated previously I may never own shares in ASC!

Regards

PTH

good post EW , quite agree with all. I admit I was lucky and bought at 10p and was cosidering selling some when they dropped of their peak in August. However I could not see a share about which i felt more confident in the medium term so when they briefly dipped to 42p i bought some more.as you can see i am not always very good at following the rule book.still think this and superscap are the best things around at the moment and still think if PTH buys at best over in current period they will double by Jan/Feb time( after Xmas trading results ahve filtered through)PS i would tell you about the ones i have screwed up but its regretably a much longer story, but im learning.

ptholden:

I agree with your RSI analysis, I always use it to support a Bollinger move, it's always good to have more than one indicator supporting a share price move, in either direction!

Take a look at BPRG, interesting share.

Thanks, AdieH, long term holder already:)

johngtudor, ptholden

Great having the chartist expertise available! Thought RSI was Recurrent Sprain Injury but now realise it is Relative Strength Index. Do you have chart for ASOS? Presumably the testing of the 30 bottom is a measure that oversold. RSI and BB would appear to take account of randomness in buying and selling when a particular balance is established. If significant news occurs, presumably this is, in a sense, a discontinuity, perhaps resulting in an overnight mark-up or a heavy bout of buying (or the reverse). This has clearly happened twice already in the last few months with ASOS. My argument, in line with willfagg, is that this will probably happen once or twice in the next four months with ASOS. The charts can't be expected to anticipate this except perhaps in the balance of buyers v sellers. However, I realise that the theory has a place and am resolved to work through the eyield seminar.

Quiet today suggesting that both buyers and sellers are having a rest day or that the price is sitting at a happy medium.

By the way, PTH, had a good day on Monday with 36 Stableford points and expected to win some lolly - only to realise that I had had an SM and forgotten to put my stake in!

Eric