Originally Posted by
FTG
Consistently successful long-term investing is rarely 'easy'. TA is just one of a bunch of tools available to an investor to assess whether & when they would be best to enter, or exit, an investment. At the least, it can make the decision making process a little easier for the investor.
I think many folk view TA as only being suitable for Traders. I beg to differ.
Sure, for medium/long term investors I wouldn't advocate that they only use the TA tool. However IMO, by using TA in conjunction with other tools & analysis, one can quite effectively evaluate & much better understand the market's view of the company. Therefore either further validating other information that one has gleaned from DD. Or, raising some red flags that may indicate some underlying, often 'hidden', issues. A basic premise to keep in mind is that a price chart will objectively show you WHAT has and is happening (and what MAY more likely happen in the more immediate future). A price chart can also give you a good read on what 'emotional state' the market participants were/are in. But unfortunately, it won't tell you all the reasons WHY it has/is happening.
In answering your question "at what point would buy signals show"? I subscribe to the view that for most medium/long-term investors, if using TA, it is best to keep the KISS theory top of mind.
More specifically use weekly price charts, or even better monthly, rather than using Hrly & Four Hrly (& maybe even daily) charts, which present far too much "noise" for most medium/long-term investors to effectively assess the situation.
Additionally, there is no need to over complicate things by placing multiple indicators on these big-picture charts.
They key objectives of taking this approach are to identify A) the actual medium/long term trend B) Any meaningful Support/Resistance Zones and key Pivot points.
In GNE's case, it has clearly been on a multi-month downtrend (Lower highs - Lower Lows). In fact, it has been pretty much one way traffic since April 2021. A 42% fall from the ATH to the recent low.
But....as I previously alluded price action is now occurring around an area of significant S/R (plus for the FIB geeks - $2.31 marks the 61.8% retracement). Volume has also picked up in recent weeks (which often happens around key turning points).
Some Green (pun intended) shoots perhaps? Are we now finally seeing a significant low forming? Only time will tell, but once the weekly chart starts consistently printing above circa $2.55 then it may be the time for the medium/long-term investor to pounce!
However, be aware & remain vigilant. IF, GNE breaks through this support zone, then IMO it would be much more likely that we would first see some sort of capitulation (bad news?) event.