Device Failure:
The saying goes “never fall in love with a stock.” It should be rented, as long as it is acting technically fine. That could be weeks, months, or years. As long as the catalyst that made you get involved still exists move the stops upward. Below is the chart of a former general in the medical equipment arena. STE was a robust performer that has been in an uptrend for almost the entire time since it came public nearly 10 years ago. That was until the week ending 4/22 recorded a nasty reversal at all-time highs, and it has been in a tailspin afterward. It has advanced on a WEEKLY basis just 14 times since then, and it has gone literally nowhere since the 22% combined loss the 2 weeks ending between 9/16-23, more than double the loss of the IHI. Technicians often like to mention that “nothing good happens below the 200-day SMA” and the longer it trades below there, the worse. There is no reason to be a hero on the downside until PRICE confirms below 160. Patience is a virtue.