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My question regards volume, and how it effects stock prices. I have a stock, (SGI) that has been on the rise for days. Each day the price and volume rise. Today alone it gained 9.76% in price, and had a volume of: 5,869,000. I am wondering why I should believe that this stock will not continue to rise. If so many people are trading, and it's so popular, why would it ever drop? Thanks to anyone who can help.
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I like this company, but I wouldn't buy right now. I like the rally it has seen the last few days. The volume has risen with the PPS and thats good but a profit will be made where a profit will be made. At this point everyone who had bought before today stands to make a profit. In order for them to make a profit they need buyers to fill their orders at the higher pps's. Every penny stock has its life cycle, what goes up will come down, it's the way it goes. From a technical analysis the MACD and the RSI are indicating a sell off realitivly soon. It's a good stock and after a powerful run like this I would place my stop limit order near what you think the top will be and buy back when the RSI reaches 35-40 again. SGI still may have a few days left before you see the .10+ drop. Watch the L2's and when there are no more buyers at ask, get rid of it and buy back after the fall. Study up on MACD and RSI indicators and stock charts will appear 3D. Good luck
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It's in overbought territory.. it might go slightly higher to let's say RSI 80 and then you will most likely see smart money selling off.. also if you want to be into charts learn about Candlestick charts... below is a recommended book...
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