Short Position - EXBD
Action number references are to actions shown
on the Action History Chart at the bottom of the page.
Step number references are to Tutorial Steps.
If you need help with terminology refer back to that Step of the Tutorial or the
FAQs associated with that Step.
We added this one to the portfolio because the NASDAQ Market Configuration
Chart appears to be in freefall and EXBD seems to be tracking a parallel course.
We like the looks of both
the Configuration and Action History charts, it has a moderate Risk Corridor,
and it is falling from its historic high.
Action 1) - 8/6/06:
Step #1 - NASDAQ registers a Stage 5 - Bear Market.
 Step #3 -
EXBD flashes a Short Configuration Signal
(click on Configuration
Chart, to the right). We execute the Short-sell. Initial Cover-Stop is established off the
hilltop resistance peak created on market close 4/21/06 at $108.96 (rounded up
to $109) which is above the 30wk moving average. Risk
Corridor is a moderate 15.6% (see Action History Chart, below).
Action 2) - 12/8/06:
Step #4 - The closing price for EXBD on 12/8/06 is observed to be
the third subsequent descending closing price since 11/17/06. Thus, the 12/8
close serves as a confirmation that the 11/17 close of $96.70 was a Hilltop
and suitable to serve as a marker for a Cover-stop. Since the 11/17 close is
above the 30wk moving average, we use the actual close value for guidance in
establishing the Cover-stop: $96.70 rounded up to $97. We will await the next
EXBD Hilltop to trigger the next EXBD Cover-stop adjustment (see Action
History Chart, below).
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