Tuesday, 29th December 2015 08:49 - by Moosh
So now we’ve established that the RSI (relative strength index) oversold position could be considered as a possible entry position, we enter the RSI zone where companies which have recently dipped to a daily RSI oversold position will be highlighted.
Since these will still be in stage 1 of a trend I will also mention an incubation time (as it stands currently, also referred to as dormancy period) which one must hold for before stages 3-4 are likely to appear, then it’s your choice whether you are willing to buy and hold for that length of time or not.....and even if you don’t, there may be other investors/traders sitting on the sidelines (sideliners) waiting for the RSI oversold position to hit before they take up residence. After all, the easiest money to make if you are a trader is on the RSI oversold-overbought swing, which should unfold over the four stages of an uptrend.
This week is an update triggered by a webcast from SRT which, although didn’t provide anything definitive in terms of news, did manage to stir up sufficient investor interest to shorten its incubation period so as promised, here are the updated incubation (for holders)/dormancy (for sideliners) periods for the selected companies:
Proton Power Systems (PPS) – 8 weeks
Empyrean Energy (EME) – 6 weeks
Asiamet Resources (ARS) – 8 weeks
Software Radio Technology (SRT) – no longer in incubation/dormancy and is ready for stage 3
It is still all quiet from ARS and PPS, and while EME did release news last week, the news wasn’t strong enough to entice investors to buy and hold in their masses enough to vastly shorten its current incubation/dormancy period. Everything is subject to change of course.
Related articles:
Anatomy of a Trend www.lse.co.uk/blogs/member/moosh-blog/8ebo7x
Money Management in the RSI Zone www.lse.co.uk/blogs/member/moosh-blog/zy29o4
Adventures with Newforestlad www.lse.co.uk/blogs/member/moosh-blog/kwj03f
Adventures with DC9 www.lse.co.uk/blogs/member/moosh-blog/u67zgs
DC9 Synchronicity on Multiple Timeframes www.lse.co.uk/blogs/member/moosh-blog/whn68v
The Writer's views are their own, not a representation of London South East's. No advice is inferred or given. If you require financial advice, please seek an Independent Financial Adviser.