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Devry Inc. - A Flunking Grade 
Tuesday, June 1, 2010
By Gibbons Burke
Devry Inc. (DV3) shares have fallen -22.7% from the 52-week high, $74.36, made in the third week of April, to Friday's close at $57.49. The stock dropped 7.3% last week and on Thursday sank to a 13-week low, and broke through a supporting trend line. The stock has closed below the lower Bollinger band on two successive trading days, and, as of Thursday's close, which sank the share price below the 200-day average price, the stock is below all the moving averages we track.
Yet, history offers some hope that we may be reaching a price level where DV might be a profitable opportunity to go long.
Q: How has DV performed in the past when the stock price has closed below the lower Bollinger band on two successive trading days in the last two days of the week?
A: According to the 17 previous occurrences of this event, EventEdge indicates that DV has shown a somewhat bullish edge that peaks 17 trading days after the event. Thus, the projected date for the peak of the bullish edge relative to the current event date (Friday, 28 May 2010) is Tuesday, 22 June 2010. DV rallies in 88% of the cases (15 of 17) by an average of 10.0% relative to the close on the event date. The average of the 2 declines is -6.4%. The overall return of the 17 cases is 8.1%, which, based on the close of DV on the event date ($57.49), provides a target price of $62.15.
Click here4 to view this trading idea in EventEdge®.
Gibbons Burke5 is editor of MarketHistory.com.
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Let variable values:
@ = GII.DV.NYSE
theEvent = IF
@ is less than bollinger_low ( @, 20 units, 2 )
AND
1 value ago {
@ is less than bollinger_low ( @, 20 units, 2 ) }
AND
Date is Friday
THEN 1
ENDIF
Date Day t-1 t+1 t+5 t+10 t+17
10/22/1993 Fri -2.6 0.0 0.0 -1.3 5.4
06/10/1994 Fri -5.6 -2.9 -3.4 -5.9 11.3
07/29/1994 Fri -6.2 -0.9 -4.2 -0.9 -1.9
12/06/1996 Fri -5.8 -0.9 -5.2 8.3 12.0
02/28/1997 Fri -15.0 0.6 17.6 6.9 10.1
01/09/1998 Fri -3.4 0.4 5.0 1.3 9.6
10/08/1999 Fri -7.4 -0.3 -11.1 5.9 20.6
12/17/1999 Fri -8.4 -3.1 14.5 14.9 4.6
12/01/2000 Fri -21.2 -3.7 8.2 11.7 27.5
03/22/2002 Fri -0.9 -2.5 -3.2 -1.5 1.3
07/19/2002 Fri -4.8 -1.1 -0.1 -5.2 -10.9
06/27/2003 Fri -1.3 -1.3 4.2 7.1 10.4
10/22/2004 Fri -25.8 -1.9 0.7 3.7 9.0
06/24/2005 Fri -2.4 1.6 4.3 5.9 4.8
03/02/2007 Fri -2.6 -1.7 1.2 0.3 0.3
10/03/2008 Fri -6.7 -3.6 -5.0 -3.5 15.7
11/13/2009 Fri -1.0 3.1 1.9 2.5 8.0
05/28/2010 Fri -3.5 NaN NaN NaN NaN
Avg -6.9 -1.1 1.5 3.0 8.1
AvgPos NaN 1.4 6.4 6.2 10.0
AvgNeg -6.9 -2.0 -4.6 -3.1 -6.4
PctPos 0.0 23.5 52.9 64.7 88.2
PctNeg 100.0 70.6 41.2 35.3 11.8
Maximum -0.9 3.1 17.6 14.9 27.5
Minimum -25.8 -3.7 -11.1 -5.9 -10.9
StdDev 6.9 1.9 7.2 5.9 8.8
ZStat -1.0 -0.6 0.2 0.5 0.9
Variance 48.1 3.4 52.1 34.2 76.6
18 Occurrences |
Comments:
Web Address of this trading idea:
Links:
2 http://www.markethistory.com/content/analog/analog.html?ticker=DV
3 http://quote.morningstar.com/stock/s.aspx?t=DV
4 http://admin.markethistory.com/events/stocks/chart.html?ticker=DV&events=CloseBelowLowerBoll0,CloseBelowLowerBoll1,weekday&date=2010-05-28
5 http://www.markethistory.com/staff/detail.html?s=gibbons