New IPO worth watching

[optionpundit]

INTREPID POTASH INC (IPI) had a very fascinating performance yesterday...this is on my radar screen due to Potash play which is currently in shortage worldwide (POT and AGU have been having great time, just check out their charts and you'll know what I am talking about)...one needs to have guts to play these ..but those who have, I suggest keeping an eye on IPI...POT is announcing earnings soon..expect a big move on parallel companies as well...

This is one of my favorite sectors...I have been mentioning time and time again...but it really needs iron muscles check out POT's chart and I think it may tell you the story..why?...

[boogafish]

POT's been one of the kindest stocks Ive ever played. I've been wanting to get back in on their latest dip after a superb earnings report but I have a bit of a dillemma. Look at their chart-- In order for them to generate a "buy at the dip" uy signal, they'd have to dip down to 170. But look at how, starting at the mid of April, they took off in a trend pattern that angles upwards a great deal more than usual and were way way above resistance. Does anyone know if there is a technical analysis rule for a situation like this, as in, where do you plunk down your money to go long? Based on POT's old trendline, it's pretty much at resistance right now...is this an old resistance equals new support situation, or was the whole breakout just an abberation on the chart?

Also I am very keen on Intrepid; any word on when/if they become optionable?

[dylantan]

POT's been one of the kindest stocks Ive ever played. I've been wanting to get back in on their latest dip after a superb earnings report but I have a bit of a dillemma. Look at their chart-- In order for them to generate a "buy at the dip" uy signal, they'd have to dip down to 170. But look at how, starting at the mid of April, they took off in a trend pattern that angles upwards a great deal more than usual and were way way above resistance. Does anyone know if there is a technical analysis rule for a situation like this, as in, where do you plunk down your money to go long? Based on POT's old trendline, it's pretty much at resistance right now...is this an old resistance equals new support situation, or was the whole breakout just an abberation on the chart?

Also I am very keen on Intrepid; any word on when/if they become optionable?

IPI is not optionable. I've checked on it last time around.
As for POT, maybe I suggest you check thru their moving average. For me, I will based on the 15 and 50 MA. If it is way above or even in between the 15 and 50 MA. I feel that it is still overbought. Doesnt seems like a good entry for me. Or, you can based on its RSI.

Just my 0.02

[boogafish]

Yeah, I've played around with the 30 day MA, but  haven't looked at your method 15 and 50. Sounds good. Based on the 30 day MA it's pretty much right there. But when you combine it with some other trending indicators it's still saying it's overbought. I might just plunk down a little bit at this point to not miss out--then add to it once I get a definate buy signal.

Thanks a bunch!

[boogafish]

POT's done great since bouncing off their 30 day MA last week.

And FYI-- IPI is now optionable!

[Pug]

I have been going with AGU but also waited for IPI to become optionable.  For me IPI is a little hard because there really isn't any pattern to go by.  I watched AGU daily for 5  months so I can be comfortable with the usual daily/monthly pattern.  I just started options trading so I'm trying to be careful, take things slow and really try to stick to my 3 plans.  This past week I broke 2 of my three, but I'm in what I call the learning phase so loses thru stupid mistakes is expected. 
I have noticed that IPI's and AGU's volume is incredibly low over the past few days, so movement on AGU is off.  This seems normal to me because I've seen AGU basically do nothing for 2 weeks then shoot up only to come crashing back down after a few days. I'm use to AGU going from low 60's to mid 70's about every 2-3 weeks, but lately there seems to be a new floor (I don't know the technical word for the expected bottom). I'm thinking it's somewhere around 80.   How can I figure out where the new bottom is?
Any ideas/advice  on how I can speed up the pattern learning.  Watching a stock for 5 months is good as long as the pattern doesn't change dramatically, but now AGU has recently had what appears to be a breakout and IPI is new.  So far, these are the only 2 stocks that I'll do options with because I'm familiar with the sector and that's the only thing, I think, that's prevented me from only having 1 loss out of 5 trades.

[boogafish]

Welcome to the world of high stakes gambling.

IPI moves with POT and, mostly, AGU as well.. My first entry point will be to buy IPI calls whenever POT reaches some sort of support level just as long as IPI's CEO doesn't get hit by a bus or something.

You want to look for support by doing a couple of things.. Look at the chart I posted of POT. I drew on there 2 key levels of support--the top one youd want to be pretty conservative in playing...the bottom one you'd want to leverage both eyeballs on. Then there's the Moving Averages. Ive found that certain stocks do real well with a50 day MA.. others are better with a 20. I like the 30 for most everything. Dylantan appears to play this with a combo of a 15 day and a 50 day. Last time POT bounced right off the 30 day MA, sort of the same thing.

I'm glad to see it coming down right now; it should give us a chance to play it again.

Rules are very difficult to stick to in the options game. That's partially why I'm so prone to technical analysis...I don't get wrapped up in the whole.."but it's Google, what a wonderful company with exciting potential! Worth 3000 bucks a share! I can't sell my Google calls, ever!!" mentality. I'd like to take it to a whole new level and have a robot trade my directional system, but he'd probably get distracted and start looking at robo-porn instead.. nuts, bolts and a whole lotta screws. There's be oil all over the place.  I'd have to destroy him and sell him for parts just to make up for my losses. Maybe sell the oil before crude retracts..