Top 7 warnings Enron gave before crash

stocks and trading basics

Top 7 Warnings & Enron Nailed In Coffin

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Gents,
Lesson in market crash


From big profits to total wipe out of investor capital

When stock goes down it gives warnings time and again.
But the pity is the investors,stay complacent,and prefer to listen to analysts
on TV rather than catch up with the hidden clues the technical analysis gives.

7 warnings to stock moving into coffin to get nailed
As told by Alan Farley

1. Broken trendline after 5 month rally--beginning of the downside
2. when the stock breaks the 50-day moving average on strong volume.
3.The stock then waves another red flag.
Price bounces back to the 50-day moving average from below but fails to break it for four sessions. Hear that ominous sound?
Warning No. 3 just rang a very loud bell.
4.The selloff expands out of the failed test and closes at the low -- right at the 100% retracement of the last rally.
This level should provide strong support and stop the selloff. So how come day-traders didn't step in and bounce the stock before the close? Members of the jury, I give you Warning No. 4.
5.Armageddon strikes the next day. Price rips a 19% gap on high volume and
6.Price breaks the 200-day moving average.
7.Nail in the coffin
Watch what happens when we zoom out and look at the long-term chart.

The gap triggers the failure of a multiyear channel breakout.
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