August Technical Analysis – DRN

Downtrend my foot…so far August has been a swan dive.

DRN sits well below the 50 and 200 day moving averages, with the 20 day leading the way down.

July’s assessment:

What a month! After finding support from the October uptrend, DRN shot back up and hit a new 52-week high (roughly a 30% move). This was one of those moments where I ask myself, “Why did I sell calls?”. But the market intervened, and DRN fell back to the mid-70’s. We’re now back to the 50/200 day moving averages, so it is anyone’s guess where we’ll be headed.

DRN sits $30/share below its price at July’s option expiration date (almost 40%). The August downtrend is pretty steep, so I would expect some moderation over the next few weeks as DRN tests the near term high around 55/share and fr a near term low around $36.

I also reviewed my position size, and it turns out that an adjustment is needed. DRN surpassed its largest percentage drop over a 20 day period (it was 34%, and now it sits at 54%). Since I downsized my position last month due to my uncertainty about where the market was headed, I only need to get rid of 100 shares.

Advertisements

About T. Knight
Blogging about my journey to financial independence via investing for cashflow.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: