Knology (KNOL)
Company
"Knology Inc., headquartered in West Point, Georgia, is a leading provider of interactive communications and entertainment services in the Southeast. The Company began trading publicly on the Nasdaq Global Market in December of 2003. Knology serves both residential and business customers with one of the most technologically advanced broadband networks in the country. Innovative offerings include over 200 channels of digital cable TV, local and long distance digital telephone service with the latest enhanced voice messaging features, and high-speed Internet access, which enables consumers to quickly download video, audio and graphic files using a cable modem. Knology also provides advanced communications services, such as video-on-demand (VOD), subscriber video-on-demand (SVOD), digital video recorders (DVR), High-Definition Television (HDTV), interactive television (iTV), IP Centrex services, and Passive Optical Network services (PON)." (company website)
Sell short
20-Nov-06. Knology is leveling out of an uptrend (see sidebar). Early in the session I shorted KNOL. There is a lot of weakness in the chart, suggesting that a correction is on the horizon.
- Price momentum (PPO) — plunging
- Trend (ADX) — weakening, and selling pressure (-DI) is above buying pressure (+DI)
- Money flow (CMF) — inflow has steadily tapered off and is now neutral
- Relative strength (RSI) — weakening
- Volume — average volume falling off noticeably
Buy to cover
Bottom line-3%
8-Dec-06. Although KNOL is far from my cover-stop, I decided to cover anyway. KNOL is up more than 6% today on heavy volume. This week there has been a sharp rise in momentum (PPO), buying pressure (+DI), and relative strength (RSI). KNOL has spent several weeks bouncing around the $10 level, and simply took off in the last hour. I've seen no news about the stock, but something has obviously altered sentiment about KNOL, and I see no reason to lose more money while waiting around to see what it is. Having spent such a long time near the 52-week high, this could be the start of a breakout. Do I want to put money on that? Not yet.
