This post was published on ZYX Buy Change Alert.
The average buy price was $3.83. On Friday we issued a sell signal to exit the position in the zone of $10.43 to $11.88. Subsequent to the post, the stock went as high as $12.06. Since then it has fallen and is trading at $8.89 as of this writing.
We have received many questions from subscribers. Here are consolidated answers.
Question: Why did you sell when the stock broke out on heavy volume and the next target on the chart was $16?
Answer: Our calls are based on six screens of the ZYX Change Method. You can learn about these screens here.
The Technical Screen is only one of the six screens. Traditional technical analysis no longer works as well as it used to. We have developed innovative proprietary algorithms. Please click here to learn more.
According to our algorithms, the breakout had all the characteristics of a false breakout. Therefore it was prudent to sell into the strength.
Question: Did you look at research reports from these brokers (subscribers quoted three different brokers) recommending buying this stock when you issued a sell signal?
Answer: Yes. We found the reasoning in these reports to be highly flawed. Moreover it was easy to verify that the positive call was not going to work. Here is how. We always have four oil fracking sand stocks on our radar: EMES, FMSA, HCLP and SLCA. None of the EMES competitors have seen increase in business that the brokers claimed EMES was seeing. In the end sand is a commodity. It makes no sense that only one company providing a commodity would see an increase in business and not its competitors.
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