Bidu - Weekly Chart : Importance of Recognizing Continuation and Reversal Patterns

The time frame used in this chart is a four-year cycle.This will allow for position traders to focus on the primary and secondary trends, while not focusing too much on the minor trends. I recommend using both a four-year chart and a 9-month chart. The 9-month will be used for the daily and 4-year for the weekly.

Brian Shannon wrote an article featured in Stocks, Futures, and Options Magazine. In this article, http://www.sfomag.com/homefeaturedetail.asp?ID=-1587695919&MonthNameID=May&YearID=2006, he explains how "multiple time frame analysis can increase the odds" of your trading success.

Investopedia explains position trader, http://www.investopedia.com/terms/p/positiontrader.asp

Furthermore, I took a short position in Bidu at 437.05. I held the position for a month and five days and exited when it recycled back above the 50-day sma on the daily. It went as low as 394.56 before recyling back above the 50-day sma. However, my exit was at 424.00 due to an extended throwback after breaking through a bearish pennant.

Moreover, its important to watch the 50-day sma in that big institutional investors and funds will look at this sma closely. They will also look at the 200-day sma and will use the averages as a means to propel the stock higher or lower.

Bidu has a beta of 2.3 and can have some pretty wild swings. When Bidu announced its last quarterly earnings, it had a drop from 439.90 to 353.03. That was 24.6% in only two days!