From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #112 Reply-To: canslim Sender: owner-canslim-digest@lists.xmission.com Errors-To: owner-canslim-digest@lists.xmission.com Precedence: bulk canslim-digest Monday, February 9 1998 Volume 02 : Number 112 In this issue: Re: [CANSLIM] Circuit Breakers Re: [CANSLIM] Circuit Breakers Re: [CANSLIM] Circuit Breakers [CANSLIM] Daily Graphs, DG Online [CANSLIM] DG, DGO [CANSLIM] WON, DGO Re: [CANSLIM] Daily Graphs, DG Online [CANSLIM] Help in understanding WON rule Re: [CANSLIM] Help in understanding WON rule Re: [CANSLIM] Circuit Breakers Re: [CANSLIM] IMRS [CANSLIM] TMBS Re: [CANSLIM] Software? [CANSLIM] Waaco Kid's "CANSLIM" forum [CANSLIM] LUV Re: [CANSLIM] stops etc Re: [CANSLIM] THRX Re: [CANSLIM] THQI Re: [CANSLIM] Stock picks Re: [CANSLIM] Stock picks Re: [CANSLIM] Software? [CANSLIM] If you're bold. [CANSLIM] SFSK action ---------------------------------------------------------------------- Date: Sun, 08 Feb 1998 09:59:40 -0600 From: Dave Cameron Subject: Re: [CANSLIM] Circuit Breakers Tom Worley wrote: > > For those that may not have noticed, the big wire houses once again have > carried the day. The new proposals to change the current circuit breakers > (at 250 points and 350 pts) that temporarily halt, then stop for the day, I noticed this, especially since we had a somewhat recent discussion on the merits of circuit breakers at an absolute level vs. a percentage level. I'm doubtful that we, as a group, agreed on the better solution; but there were strong points made for both methods. > trading have now been adjusted. NYSE is now proposing that the halt for the > day will come about only if the mkt is down 20% after 2PM (before it would > have stopped for the day at any 20% decline) and at any time if down 30% (oh > joy, a 2400 pt decline will stop panic selling, as if a 1600 pt drop wasn't > bad enough!!). > I can safely say that no one in this discussion group mentioned circuit breakers at such a low level. However, what I am interested in knowing is why people think we should have circuit breakers at all? Isn't this a means of essentially doing away with circuit breakers (almost)? > Can we all say "useless circuit breakers"??? If not, can we say "free reign > by the wirehouses"?? I guess you agree with the last statement I made, but should we even have any circuit breakers? Dave Cameron dfcameron@ameritech.net - - ------------------------------ Date: Sun, 8 Feb 1998 11:23:10 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] Circuit Breakers Oops, showing my age, make that 350 and 550 pts respectively (and even those may be wrong, they say memory is the first to go, I think). Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - -----Original Message----- From: Tom Worley To: CANSLIM Date: Sunday, February 08, 1998 10:44 AM Subject: [CANSLIM] Circuit Breakers >For those that may not have noticed, the big wire houses once again have >carried the day. The new proposals to change the current circuit breakers >(at 250 points and 350 pts) that temporarily halt, then stop for the day, - - ------------------------------ Date: Sun, 8 Feb 1998 11:40:19 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] Circuit Breakers The use of circuit breakers arose from the '87 "crash" in which the ones mostly hurt were the ones that panicked. Those that gritted their teeth, or better still bot on the oversold conditions, either survived or made money. Because program trading has become such an influence and has such an ability to "move the mkt" and is essentially a function, activity and profit center of major wirehouses, the circuit breakers were a concession by the wirehouses to the concept of fair play for the individual investor. Yes, the new proposals essentially eradicate the later stage circuit breakers, leaving in place only the 50 pt (stopping the automatic program trading) and the S&P500 (15 pt??) barrier on stop loss orders over 2099 shares if memory serves me. Obviously the wirehouses have developed ways to accomodate these circuit breakers, as they have been regularly triggered lately without complaint. Should we even have circuit breakers? If the mkt is intended to first be for individual investors (whether directly or thru mutual funds), as opposed to trading accts of wire houses, then yes, I think we need restraints on wirehouses. They abuse the system, frequently trading for qtr pt gains on qtr million share blocks, without regard to any "investment" scheme. They often do so to the detriment of even their own clients, much less the rest of the investment community. Their "institutional" traders are segregated from their retail brokers, and may at times be at cross purposes. Ethical?? You decide. Should money demand better mkt access? Should you get better execution or money management because you have $10 million to invest instead of $10 thousand? In some other countries, I might say that power is might, and this system is acceptable. In the US of A, where all are "supposed" to be treated equal, and we each pay our taxes that supports our form of govt, then I think not. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - -----Original Message----- From: Dave Cameron To: canslim@lists.xmission.com Date: Sunday, February 08, 1998 10:58 AM Subject: Re: [CANSLIM] Circuit Breakers >Tom Worley wrote: >> >> For those that may not have noticed, the big wire houses once again have >> carried the day. The new proposals to change the current circuit breakers >> (at 250 points and 350 pts) that temporarily halt, then stop for the day, > >breakers at such a low level. However, what I am interested in knowing >is why people think we should have circuit breakers at all? Isn't this >a means of essentially doing away with circuit breakers (almost)? > >> Can we all say "useless circuit breakers"??? If not, can we say "free reign >> by the wirehouses"?? > >I guess you agree with the last statement I made, but should we even >have any circuit breakers? > >Dave Cameron >dfcameron@ameritech.net > >- > - - ------------------------------ Date: Sun, 8 Feb 1998 11:46:29 -0500 From: "Tom Worley" Subject: [CANSLIM] Daily Graphs, DG Online Tried numerous times this weekend to access DG Online, as well as the Daily Graphs site, no joy. Anyone got a status on either? Did DG Online go commercial this weekend (I never get notified of changes). tom w - - ------------------------------ Date: Sun, 8 Feb 1998 12:03:10 -0500 From: "Tom Worley" Subject: [CANSLIM] DG, DGO Ignore my last post, finally got into Daily Graphs site and see that there is a new software version as of 2/6/98 so downloadiing it now. Hopefully will have access shortly. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - - ------------------------------ Date: Sun, 8 Feb 1998 12:22:25 -0500 From: "Tom Worley" Subject: [CANSLIM] WON, DGO For those that haven't downloaded the latest software, you may note when you do that there is a transcript of WON's "chat" on Yahoo available under a new button "Transcript" along with some other stuff. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - - ------------------------------ Date: Sun, 8 Feb 1998 10:34:47 -0800 From: "John Iding" Subject: Re: [CANSLIM] Daily Graphs, DG Online I got announcement that they would be down this weekend (Sunday) for software updates .... back on Monday and still free for awhile longer ... John - -----Original Message----- From: Tom Worley To: CANSLIM Date: Sunday, February 08, 1998 8:46 AM Subject: [CANSLIM] Daily Graphs, DG Online >Tried numerous times this weekend to access DG Online, as well as the Daily >Graphs site, no joy. Anyone got a status on either? Did DG Online go >commercial this weekend (I never get notified of changes). > >tom w > > >- > > - - ------------------------------ Date: Sun, 08 Feb 1998 13:54:57 -0500 From: Carter Diggs Subject: [CANSLIM] Help in understanding WON rule Hello I=92m trying to learn something about trading and have been looking at th= e CANSLIM digest (understanding bits and pieces of what goes on) and reading WON=92s book. One thing that puzzles me is his recommendation to avoid stocks that have risen 10% above baseline. As he says to get from 10 to 100, you have to go through 20, 30, etc. If someone bought HD at 40 which was well above any consolidation area or base, they would have done very well. Can some one explain? Thanks. Carter Diggs - - ------------------------------ Date: Sun, 8 Feb 1998 11:53:06 -0800 From: "Patrick Wahl" Subject: Re: [CANSLIM] Help in understanding WON rule > Date: Sun, 08 Feb 1998 13:54:57 -0500 > From: Carter Diggs > puzzles me is his recommendation to avoid stocks that have risen 10% > above baseline. As > he says to get from 10 to 100, you have to go through 20, 30, etc. If > someone bought HD > at 40 which was well above any consolidation area or base, they would > have done very > well. > > Can some one explain? He also says to sell at an 8% stop from where you bought, and if you buy an extended stock, you have a much greater probablity of it declining 8%. So then you have a choice of giving it more leeway, since it was extended, therefore risking more money on each trade, or you stick with your 8% stop rule anyway, but then you will find yourself being whipsawed much more frequently on stocks that are perfectly sound but just a little more likely to be hit by a short round of profit taking. - - ------------------------------ Date: Sun, 8 Feb 1998 11:56:26 -0800 From: "Patrick Wahl" Subject: Re: [CANSLIM] Circuit Breakers > From: "Tom Worley" > To: "CANSLIM" > have stopped for the day at any 20% decline) and at any time if down 30% (oh > joy, a 2400 pt decline will stop panic selling, as if a 1600 pt drop wasn't > bad enough!!). > > Can we all say "useless circuit breakers"??? If not, can we say "free reign > by the wirehouses"?? I don't have a real strong opinion on the subject, but it is a market, sort of think they should just let it do what it wants to, no circuit breaker. - - ------------------------------ Date: Sun, 08 Feb 1998 15:33:33 -0600 From: Dave Cameron Subject: Re: [CANSLIM] IMRS IMRS has continued to roll since then; I don't recall who initially mentioned it - but take a bow! Dan Musicant wrote: > > On Tue, 20 Jan 1998 18:50:48 -0800, you wrote: > > > :Information Managment Resources (IMRS) showed some signs of wanting > > :to go breakout today. ALso, Computer Learning Centers (CLCX) moved > > :up to a new high, although the volume was not impressive. > > IMRS volume was double ADV, not too bad, up 7.4%. I have it on my > *closest* watch list. > > Any advancing stock today that didn't show too much upside volume > looks weak in comparison to many other issues, as a cursory sort of > analysis. :) > - - ------------------------------ Date: Sun, 08 Feb 1998 18:26:49 -0600 From: Dave Cameron Subject: [CANSLIM] TMBS My stock pick for the week is TMBS. EPS/RS is 99/98 or 98/99, can't remember which. Has had a breakout day on high volume with a bigger follow-up day on Friday. Dave Cameron - - ------------------------------ Date: Sun, 08 Feb 1998 21:25:12 -0500 From: Chris Subject: Re: [CANSLIM] Software? Doug, Try http://traders.com/Documentation/Survey/98Survey.html It is a review and comparison of lots of software for equites analysis from the folks at TA of Stocks and Commodities mag. All the best Chris Hyde Douglas Motsenbocker wrote: > > Thanks for the suggestion on software. I suppose there is someplace where > I can find good a critique of software for the stock market, but I don't > know where to look. I'll check out Quotes-Plus, however. Thanks. > - - ------------------------------ Date: Sun, 8 Feb 1998 21:20:46 -0500 From: "Tom Worley" Subject: [CANSLIM] Waaco Kid's "CANSLIM" forum As a further comment to my prior post on this subject, I took a look at the two stocks mentioned (TSRI, TWLB). While both have excellent CANSLIM elements, TSRI is about 35% extended over its base, strictly a momemtum play (no surprise considering the source is a day traders/momentum site). TWLB does look good altho the base is real short. Volume has been dropping sharply, so may be setting up for a move in one direction or the other. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - - ------------------------------ Date: Sun, 8 Feb 1998 21:43:10 -0500 From: "Tom Worley" Subject: [CANSLIM] LUV Took a look at Southwest Airlines (mentioned before by John Allen) - nice LLUR type chart, good CS elements, I continually hear good things from people that use this airline. Worth watching. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - - ------------------------------ Date: Sun, 8 Feb 1998 22:15:55 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] stops etc Responses are imbedded below to the questions. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - -----Original Message----- From: Elaine/Robert Urban To: canslim@lists.xmission.com Cc: infobelize@kearney.net Date: Friday, February 06, 1998 2:12 AM Subject: [CANSLIM] stops etc >Could a limit price be skipped? E.g. limit set to sell at 45, stock goes from >44 15/16 to 45 1/16 or so bypassing your limit position of 45 as no one >takes the buy position of 45 opposite you. IN THEORY, THE LIMIT COULD BE SKIPPED ESP IF A BUYER WAS LOOKING FOR MORE VOLUME THAN YOU WERE OFFERING TO SELL. In reality, it is likely your piece would be taken out along the way. > >Is there any time when you could pick up a stock for much less (vice >versa) for that >matter, in a case where there is volatility, a stock hits a price and >you enter a >ridiculously low price and close because you were the "next" price? ANYTHING IS POSSIBLE IN THE CRAZY WORLD OF THE MKT. Again, such is unlikely, but can happen esp on a stock with a large spread. When you get close to the end of the trading day, some holders are willing to sell at any price, so a buy limit set below the mkt might still get executed if someone wants to sell bad enough and has sufficient size to drive the mkt down. > >Should one not put stops in whole numbers? With program trading, when it >is taking >place, is there a predictable pattern that one can profit from? WHETHER BUYING OR SELLIING, STOPS OR STOP LIMITS, I NEVER USE A WHOLE NUMBER. My limits are set after looking at the chart and watching the trading, and will always have a fraction on them. I don't like being in the crowd, and the crowd tends to use round nrs. - - ------------------------------ Date: Sun, 08 Feb 1998 21:32:47 -0600 From: Dave Cameron Subject: Re: [CANSLIM] THRX Peter Christiansen wrote: > > ** Reply to note from "Antista, Anthony" Mon, 2 Feb 1998 11:36:12 -0500 > > > I believe that this is one of the best C&H i've seen in a while. PE look > > high. Does anyone agree?? > > WON says that the handle of a proper cup & handle should remain in the upper half of the > cup. In the case of THRX, it should hold above 43 1/2. This was not the case. Maybe it > will build a handle around the current levels. In the mean time, I would steer clear. > Of course, THRX forges on madly since this post. I interpreted the graph more or less the same way Peter did, due to the non-handle. THRX doesn't seem to want to stop and form a handle. Much as we'd like, this isn't a science. You just have to be right enough to make decent money. Dave Cameron - - ------------------------------ Date: Sun, 08 Feb 1998 21:43:35 -0600 From: Dave Cameron Subject: Re: [CANSLIM] THQI OK, no one else touched this one, so in the interest of trying to match Tom for messages sent in one day, here goes. THQI had a big run up late last year. Early this year, it formed a small cup. This is probably some profit taking, given the volume. Anyway, I don't see a lot of upside in the near future. I think the stock needs to base a while before starting another run. Friday's action seems to confirm this for me. Dave Cameron Antista, Anthony wrote: > > Hey group, > > I would like some input on this grouping. They came out of my > I've been following THQI for a while and it seems that the rise this week > was because of the error made by First Call that earnings were going to > come out on 2/4/98. Earnings will be released during the 3rd week of > February, per Invester Relations, and expect a similar rise preceeding that > as estimates are lower than what it will report. Estimates are for about 50 > cents for the 4th qtr,which have been upgraded from 38 cents, and about 98 > cents for the year. If you need more details on THQI go to the following > web site: > > http://home.earthlink.net/~tr8rvic/ > > Tony > > YOU WROTE: > > Zacks canslim search. The Group #'s are not the greatest but > they all meet the criteria. > > Tick / EPS/RS/ud > thqi /65/98/1.4 > nbty/82/98/3.3 > mdc/91/95/5.9 > cbr/99/92/2.1 > cacoa/79/98/0.9 > air/91/89/1.8 > nct/90/94/1.7 > > They all had breakouts from a 9 day base yesterday. > > Thanks for any suggestions given, > > Jose' > > Name: WINMAIL.DAT > WINMAIL.DAT Type: WordPerfect 7 Document (application/x-unknown-content-type-WP7Doc) > Encoding: x-uuencode > > - - - ------------------------------ Date: Sun, 08 Feb 1998 21:50:19 -0600 From: Dave Cameron Subject: Re: [CANSLIM] Stock picks Oh what the heck, I'm on a roll... I looked at all of these. Patrick, whenever you post stocks, I have this tendency to rush out and go on margin! Seriously, these are some good ones. You generally have good reads. I admire that you fill in details about EPS, avg shares traded, sales, etc. Once upon a time, a couple members of this group tried to formalize a worksheet whereby we'd fill in the CANSLIM criteria. This lasted for a while but, being the eclectic group we are, didn't last. Its good to see facts. I should do that more... Dave Cameron Patrick Wahl wrote: > > Here are a few stock ideas from rummaging around on the internet. > All have high EPS ranks, high RS, most near a base, a few might be > extended just a bit, depending on how you read the charts. > > Hon Industries (HONI) EPS 91, RS 85, 30 mil shares, A/D A, sales > last few quarters accelerating, avg vol 59K. > > Express Script (ESRX) EPS 94, RS 90, 8.6 mil shares, AD B, > sales up 50%, earnings up 20's %, avg V. 44K > > Cotelligent (COTL) EPS 95, RS 86, 9.7 mil shares, AD A, sales > up in 40's%, Avg Vol 46k. p/e 29. > > Advance Paradigm (ADVP) this one has a lower EPS rank, but sales > are certainly growing at a +90 rate, think earnings just need a > quarter or two to catch up, so I think ok here. > > Mastec (MAST) might be a bit extended > QRSI > CZT > CHRZ > IMRS if p/e's over 100 don't worry you this one looks good. > > Newcourt (NCT) low EPS but interesting chart. Think they took some > charges, but sales still growing rapidly. > > - - - ------------------------------ Date: Sun, 8 Feb 1998 20:05:40 -0800 From: "Patrick Wahl" Subject: Re: [CANSLIM] Stock picks > Date: Sun, 08 Feb 1998 21:50:19 -0600 > From: Dave Cameron > good reads. I admire that you fill in details about EPS, avg shares > traded, sales, etc. I don't always do that either, had a small burst of energy or something. I think you mentioned TMBS, that is another good one. Incidentally, got a couple of those stocks at www.bigcharts.com, so a place worth visiting once in a while. - - ------------------------------ Date: Sun, 8 Feb 1998 23:19:38 -0500 From: averil@legendcomm.com (Averil Strauss) Subject: Re: [CANSLIM] Software? Free software... Traders Access MarketCenter Platinum Edition No price given KasanjianPatternSmasher Averil Strauss averil@legendcomm.com 800-668-7077 - -----Original Message----- From: Jose O. Perez To: canslim@lists.xmission.com Date: Saturday, February 07, 1998 9:32 PM Subject: Re: [CANSLIM] Software? >Hi Douglas, > >Go to this site, they have a comprehensive survey of software for the >trader.... > > http://www.traders.com/ > >They also have abstracts of articles from their magazine. > >jose' > >Douglas Motsenbocker wrote: > >> Thanks for the suggestion on software. I suppose there is someplace where >> I can find good a critique of software for the stock market, but I don't >> know where to look. I'll check out Quotes-Plus, however. Thanks. >> >> >> > >> >> - > > > > >- > - - ------------------------------ Date: Mon, 09 Feb 1998 09:26:02 -0500 From: Connie Mack Rea Subject: [CANSLIM] If you're bold. - --------------9A9C6091455D5A94CFB9DE7E Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit Members-- These are some stocks that meet my OBV/MF criteria. I will not buy any of them for several reasons. First, I've still that queasy feeling about the market and about external that have occurred [threats by Saddam and Yeltsin, Asia, the Saudi reluctance, allied reluctance, and the Zippergate]. Second, internally, the market looks overbought while at the same time approaching new highs that in the past have failed to breakout. Consequently, I am today 90% out of the market. I hold SYBS, SSC, and a few shares of ORCL. I will be glad to be stopped out of these. I am, again, looking for shorts. I have been reminded by a couple of members that some of my stocks have nominal volume and have wondered why a day trader works them. As I have posted before, the definition of "day trader" is language full of unusual vigor, romance, and defects. No day trader [who is not broke] ever envied investors, but most investors envy day traders who look at the market like a financial O.K. Corral. About one tenth of one percent of all who are in the market are pure day traders, those who do not carry a long or short over to the next day. These are pure day traders; these are the scalpers. The relation between investors and pure traders is less like that between an anonymous mason who contributed an accomplished piece of stonework to a medieval cathedral and more like the anonymous mason who secretly stole stonework to build a fireplace at home. Scalpers are called unprosecuted thieves. Most of us who are called day traders are really just short term traders however much we like the vigor, the danger, and the romance of a 9:30 to 4:00 life. But, speaking for myself, I don't scalp more than three or four times a month. I have criteria for scalping different from short term trading. Scalping is like holding your breath underwater: A lot of bad things can happen as opposed to a single good thing. I trade low volume stocks that I have denied trading to would-be traders and investors who want another life. I look at these people as I do students in my class in "Atheism and Existentialism." Though no one in my family has been to church in three generations, I do not hustle or encourage any student to become an atheist or existentialist. That jump is too far between shores; that jump is too important. I proffer reasons not to take my position. Few people can live my life, nor should. Analogously, few people ought to become, or try to become, scalpers. Two of my friends plead bankruptcy [not because of my influence] because they became hooked on the romance of scalping. As I discourage my students from atheism and existentialism, by whatever argument, I discourage investors from turning scalpers. How can an investor who hasn't mastered investing turn trader? How can anyone be a trader who hasn't lived through a bear market? I trade [but don't intend to scalp] low volume stocks, even with large spreads, because I don't buy them except at my price. I use a lot of fill-or-kill orders, I buy between the spread, and I want not only my OBV/MF indicators to be unusually strong but some other indicators to look "right." And throw in a hunch or two. Too, I'm putting in extreme danger only five percent or less of my capital. Higher volume stocks get more of my capital. By definition, there shouldn't be any scalpers and but a rare few traders watching this site. Were this a trader site, we would be having a much different conversation. Most of this group, a group that I have much affection for, comes here because they only incidentally may harbor a taste for trading but not a hunger. I encourage students to become more than students; I encourage them to become semi-scholarly, even scholarly. There is no contradiction here. But there is a contradiction when I discourage anyone from becoming a scalper or, perhaps, even a short term trader, and still tell him how. Students come to the university with a taste but not a hunger for education; they are impatient of regulation and are quickly wearied by the thought that they cannot get a degree of some kind in a year or two so they can begin making money. They easily elude that learning that cannot be hurried; they are best remembered by their professors for their physical mobility and their intellectual insignificance. I don't wish to have cause to remember any investor by his physical mobility and his financial failing. Members can examine these stocks if they can forgive my contradictions: SCPP CNBM DGIC PVH EFTC Connie Mack - --------------9A9C6091455D5A94CFB9DE7E Content-Type: text/html; charset=us-ascii Content-Transfer-Encoding: 7bit Members--

These are some stocks that meet my OBV/MF criteria.  I will not buy any of them for several reasons.  First, I've still that queasy feeling about the market and about external that have occurred [threats by Saddam and Yeltsin, Asia, the Saudi reluctance, allied reluctance, and the Zippergate].

Second, internally, the market looks overbought while at the same time approaching new highs that in the past have failed to breakout.

Consequently, I am today 90% out of the market.  I hold SYBS, SSC, and a few shares of ORCL.  I will be glad to be stopped out of these.  I am, again, looking for shorts.

I have been reminded by a couple of members that some of my stocks have nominal volume and have wondered why a day trader works them.  As I have posted before, the definition of  "day trader" is language full of unusual vigor, romance, and defects.  No day trader [who is not broke] ever envied investors, but most investors envy day traders who look at the market like a financial O.K. Corral.

About one tenth of one percent of all who are in the market are pure day traders, those who do not carry a long or short over to the next day.  These are pure day traders; these are the scalpers.  The relation between investors and pure traders  is less like that between an anonymous mason who contributed an accomplished piece of stonework to a medieval cathedral and more like the anonymous mason who secretly stole stonework to build a fireplace at home.  Scalpers are called unprosecuted thieves.

Most of us who are called day traders are really just short term traders however much we like the vigor, the danger, and the romance of a 9:30 to 4:00 life.  But, speaking for myself, I don't scalp more than three or four times a month.  I have criteria for scalping different from short term trading.  Scalping is like holding your breath underwater: A lot of bad things can happen as opposed to a single good thing.

I trade low volume stocks that I have denied trading to would-be traders and investors who want another life.  I look at these people as I do students in my class in "Atheism and Existentialism."  Though no one in my family has been to church in three generations, I do not hustle or encourage any student to become an atheist or existentialist.  That jump is too far between shores; that jump is too important.  I proffer reasons not to take my position.  Few people can live my life, nor should.

Analogously, few people ought to become, or try to become, scalpers.  Two of my friends plead bankruptcy [not because of my influence] because they became hooked on the romance of scalping.  As I discourage my students from atheism and existentialism, by whatever argument, I discourage investors from turning scalpers.  How can an investor who hasn't mastered investing turn trader?  How can anyone be a trader who hasn't lived through a bear market?

I trade [but don't intend to scalp] low volume stocks, even with large spreads, because I don't buy them except at my price.  I use a lot of fill-or-kill orders, I buy between the spread, and I want not only my OBV/MF indicators to be unusually strong but some other indicators to look "right."  And throw in a hunch or two.  Too, I'm putting in extreme danger only five percent or less of my capital.  Higher volume stocks get more of my capital.

By definition, there shouldn't be any scalpers and but a rare few traders watching this site.  Were this a trader site, we would be having a much different conversation.  Most of this group, a group that I have much affection for, comes here because they only incidentally may harbor a taste for trading but not a hunger.  I encourage students to become more than students; I encourage them to become semi-scholarly, even scholarly.  There is no contradiction here.

But there is a contradiction when I discourage anyone from becoming a scalper or, perhaps, even a short term trader, and still tell him how.  Students come to the university with a taste but not a hunger for education; they are impatient of regulation and are quickly wearied by the thought that they cannot get a degree of some kind in a year or two so they can begin making money.  They easily elude that learning that cannot be hurried; they are best remembered by their professors for their physical mobility and their intellectual insignificance.

I don't wish to have cause to remember any investor by his physical mobility and his financial failing.

Members can examine these stocks if they can forgive my contradictions:

  SCPP    CNBM    DGIC    PVH    EFTC

Connie Mack - --------------9A9C6091455D5A94CFB9DE7E-- - - ------------------------------ Date: Mon, 9 Feb 1998 12:29:24 -0800 From: Mike Lucero Subject: [CANSLIM] SFSK action SFSK has been at 60 all day. I feel like that's a bad thing, although it looks like some big money is supporting it there. Does it look about to break down? Thanks, Mike Lucero - - ------------------------------ End of canslim-digest V2 #112 ***************************** To unsubscribe to canslim-digest, send an email to "majordomo@xmission.com" with "unsubscribe canslim-digest" in the body of the message. For information on digests or retrieving files and old messages send "help" to the same address. Do not use quotes in your message.