- Posted by Greg Harmon
- on July 24th, 2013
You have heard the adage that size matters. And that plays a role in trading, but sometimes your perspective can be more important. Take for example the daily chart for Yum Brands, $YUM, below. A jumbled mess moving in a seemingly random manner. Just when you thought that it was moving to the top of a range in April it reversed and retraced. What
do you do with a chart like this? Stay away! That is unless you can be flexible enough to step back from the messy day to day action and look at the chart from a different perspective. With a longer term, weekly view you can see some rationality to this madness. What was a random mess is now a consolidation zone tightening on the top level resistance. In fact it shows that this happens often in this stock with 4 of them since the low in 2009. From this perspective it becomes a stock to put on the watchlist for the next break out over 73 which would give a target of 85. Much more attractive. Give it a try with stocks you think are just not worth looking at.
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The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Gregory W. Harmon CMT, CFA, has traded since 1986 and held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
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