A Look At DRYS

On Tuesday July 5, 2011 I posted a chart on StockTwits about DRYS inferring it was in a possible sweet spot if it could hold above 3.92.

This same chart below (three charts in one) shows how DRYS has broken above resistance levels at multiple time frames. It is much larger than normal pic, so you may have to right click and open to view full size.

drys_070511_charts.png

MACD daily signal line is flat to the moving average I use but positive. Weekly MACD signal line remains crossed for a second week- rising, though negative.

The 3.92 level is still very important to how I look at the chart relative to the latest low of 3.56 on 5/24/11. This level has been called out on a number of occasions in the charts posted to Stocktwits Chartly and I believe determines the intermediate trend direction.

Past analysis was done on DRYS with the expectation of a wave 4 correction off the 6.44 high of 12/13/10. When DRYS traded below 3.92, this negated this Elliott Wave count from being plausible.

Should we revisit an Elliott wave count in DRYS? Maybe, but right now the support resistance lines within the pitchfork formations are doing a better job of projecting direction than a wave count and we do not want to fit the theory to the data.

If price gets to 4.71 and 5.43 then DRYS could be re-evaluated from an Elliott Wave standpoint.

drys_070811_weekly_elliott_wave.png

Tagged on:
  • DRYS continues to disappoint intraday longs and has not yet diverged from market weakness. 

    The key 3.92 level posted above was breached today. DRYS reached a low of 3.83 briefly before closing at 3.96

    3.92 needed to be held in prior opinions for an intermediate uptrend to be sustainable. This is still the belief.

    Today’s trading showed how important this level may be as a significant washout was realized below this level seen at the 30 min time frame chart below. 

    As DRYS broke 3.92 it ticked the daily upper parallel line which had been breached to the upside creating the buy signal and bullish bias. 

    During the selloff below 3.92, volume was high. DRYS did however regain this level, as well as the trigger line. 

    Which head fake is in play; Was this a washout before a move higher? Or is the close meaningless, a head fake before a continued move lower.

    The marked up chart below acts as an update to the prior series of charts above and are also posted to chart.ly. 

    DRYS will need to separate itself from its history of disappointing price action as well as pressures from broader market indecision if it has any chance as a long.

    For certain this mostly sideways move after its latest test of a move higher could be viewed as constructive in such a volatile tape, but risk is still high here.

  • DRYS did not perform well today and showed no interest in remaining above 3.92 as it has in recent sessions since the last update sliding down the trigger line.

    Still trading above the upper parallel of the pitchfork, DRYS remains in a tentative buy signal, however horizontal support and resistance at 3.92 is more important to my viewpoint.

    Lower levels were illustrated in the chart below are are likely with todays close below 3.92. 

    I will not continue to follow an extended downtrend in DRYS below 3.92 and the upper parallel.

    7/25/11