From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #271 Reply-To: canslim Sender: owner-canslim-digest@lists.xmission.com Errors-To: owner-canslim-digest@lists.xmission.com Precedence: bulk X-No-Archive: yes canslim-digest Saturday, June 6 1998 Volume 02 : Number 271 In this issue: [CANSLIM] 10-Ribbon EMA & DB Re: [CANSLIM] Members - a drum roll please--Bill Re: [CANSLIM] M Thoughts - NASDAQ--Craig Re: [CANSLIM] Warning! TA! All but Bill please skip! [CANSLIM] Members - a drum roll please - Bill [CANSLIM] OBV/MF and predicting breakouts (no relation found) [CANSLIM] EDAC moving again Re: [CANSLIM] 10-Ribbon EMA & DB--Unexpurgated Re: [CANSLIM] M Thoughts - NASDAQ--Dave Re: [CANSLIM] OBV/MF and predicting breakouts (no relation found) Re: [CANSLIM] Members - a drum roll please - Bill Re: [CANSLIM] EDAC moving again--Jeffry (TA!) Re: [CANSLIM] EDAC moving again--Db & Jeffry (TA!) Re: [CANSLIM] EDAC moving again--Db & Jeffry (TA!)--Frank [CANSLIM] Re: Groups Re: [CANSLIM] KTIE for JW only! Re: [CANSLIM] KTIE for JW only! Re: [CANSLIM] OBV/MF and predicting breakouts (no relation found) ---------------------------------------------------------------------- Date: Fri, 05 Jun 1998 20:55:17 -0400 From: Connie Mack Rea Subject: [CANSLIM] 10-Ribbon EMA & DB Members-- I posed a few questions to DB about his comment on my 10-ribbon EMA [6-4]. I presume he won't claim a Clinton-like privilege if I reveal a couple of excerpts. He had said in his original post that my ribbon-EMA "may be a variation of a plot" discussed in a magazine elsewhere. I answered that his use of "plot" sounded "invidious, conspiratorial. Did my post seem so?" So many burred words have flown recently that I thought a joke about invidiousness and conspiracy might lighten the tone for members. However, DB followed with a terse non-ironic lecture on plotting: "No. A 'plot' is the placement of a line or an indicator on a chart, i.e., one 'plots' a moving average." Hmm. DB is little moved by OBV/MF/EMA, for they are "largely a waste of time." OBV "doesn't lend itself to fine-tuning" needed for entries. As far as divergences go, they "seem largely imaginary." Divergences in RSI and stochastics, however, are not imaginary "when they exist." But what might one say of them when they don't exist? What disturbs DB most about technical analyses are its "tricks." Though unspecified, they allude to those non-imaginary indicators I pay the rent with but whose divergences are "largely imaginary." Here is the excerpt: "What disturbs me about TA 'tricks' is that newbies often use them, find they don't work, then conclude that TA itself doesn't work. This can retard their growth . . . When someone who has been using your techniques for some time asks what 'positive divergence' means, I become concerned. Clearly there are at least a few people who are in the woods, but this is not being addressed." Those of you "in the weeds" may or may not know who you are. Or where you are. The implication is that you may inhabit the hinterlands because of OBV/MF/EMA and other "tricks." You are doubtlessly confederate with some technical evil. Absolution and resurrection may lie only in the hands of those most elevated. There is much more connoted than denoted here: [1] Specification of what "tricks" are and why they're "tricks." [2] Why, in the hands of newbies, ought one conclude that technical analysis doesn't work, retards growth? [3] Why the phrase "TA itself" rather than TA? Does this imply some useful internal division of technical analysis not sensed by newbies, and perhaps others? E.g., is TA divided into "tricks" and, say, "non-tricks"? To make this distinction is a legitimate point of logic, but in this instance it may be a waste of distinction. This excerpt was some annoying and perfunctory: "Whether you contribute or not is up to you . . .but if I think you're giving dangerous advice . . . I reserve the right to state my opinion." I am always uneasy when someone assumptively takes it upon himself to give me permission to do that which I may do irrespective of his permission. When we have advanced to claiming reservation of rights, it appears that some have self-elevated themselves to speak contractually rather than informally and civilly. There is a self-assumed tone of omnipotence, munificence, and adjacent power of absolution arrogated by the few for the select many. I am most moved by these qualities in my philosophers and theologians. If any one of these characteristics moves me at all, it moves me "to reserve my right" to sui generis and sui juris. Concluding his original post, DB says that he's "learned that the degree of one's success is at least somewhat related to the quality of tools in one's toolbox." Why is it that I feel modestly guilty and vaguely obligated to return the money I've made in trading on imaginary divergences and shaky indicators? But to whom will I return the money? Won't the IRS be nonplussed when I write them a refund check? I have hoped to be a Proverb[ial] ambassador rather than a mischievous messenger. It is not easy. Respectfully, Connie Mack - - ------------------------------ Date: Fri, 5 Jun 1998 21:00:26 -0700 From: Bill Subject: Re: [CANSLIM] Members - a drum roll please--Bill Perhaps we are looking at the price track differently. I am only concerned with the CLOSING price for the periods in question to conform to the way OBV is calculated. I will check other sites to get a better view. Now you really got me confused, Db. The IGEN track of OBV and Price is definately bullishly divergent notwithstanding the fact that other indicators do not confirm the move. My understanding of the term 'divergent' applies to two indicators under test. If you compare more than two, you create a scorring situation where one is positive and another is not. This is when gaming theory comes into play with the comensurate analysis of probalistics and chance. When I said I was going to 'nibble' it means that I may test the waters with a small position to test the waters depending on how the fat lady sings on Monday and if I loose money on the deal, I am going to blame you for touting a stock with no redeeming social value. :-) Bill-->> - ------------------- At 4:44 PM -0700 6/5/98, dbphoenix wrote: ><for the most part of March on the BC chart I am looking at as we >speak. Not very obvious on the scaled down version but positive >nevertheless. Price dropped from 10 to 9 1/2 in that period while the >OBV rode on the zero line. As I mentioned, this is what, I believe, >Connie uses as his first indicator to create his watch list. He then >runs through all of the other relevant indicators to confirm.>> > >Perhaps this is a function of bigcharts and the screen size. OBV >falls from 3/9 to 3/30. Granted it does not fall to the same degree >as price, but low are successively lower. Therefore, it would be >difficult to argue that it's a divergence. > ><like its ready to resolve the divergence based on today's 3 7/8 move >but as you caution, more than one indicator must confirm a change in >direction. On the short term chart, IGEN looks likes a winner and I >may take nibble on Monday.>> > >I'm afraid you misunderstood me. I was offering IGEN as an example of >what looks like a divergence but is not, that is, what looks like >divergence is more the result of static volume than of accumulation. >Today's action is less proof of divergence than of waiting until the >stock became oversold, which it did. However, the stochastic and the >RSI have only begun to turn and no buy signal has been given. Buying >on Monday would be preemptive, but perhaps you have a bit of the luck >of the Irish with you. > >--Db > > > > > >_________________________________________________________ >DO YOU YAHOO!? >Get your free @yahoo.com address at http://mail.yahoo.com > > >- - - ------------------------------ Date: Fri, 05 Jun 1998 23:12:49 -0500 From: Dave Cameron Subject: Re: [CANSLIM] M Thoughts - NASDAQ--Craig dbphoenix wrote: > > I, for one, hope that we continue down. Trying to break through all > that resistance in the 1850 area will be hard enough from here. At > least if more people gave up their shares, there wouldn't be quite so > much overhead at that level. > > --Db > Db, Shame, shame, shame! The word "hope"!?! From a seasoned veteran like you!?! You've ruined my whole image of your impassiveness ;-> Dave Cameron - - ------------------------------ Date: Fri, 5 Jun 1998 21:23:50 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] Warning! TA! All but Bill please skip! <> You're the last person I want to argue with, Bill. Part of the problem is that the chart you're looking at is so small. On a full-size chart, it's clear that the OBV is falling. In order for the OBV to be divergent, it must rise while the price falls. It needn't rise in a steady, uninterruptedly ascending line, but each peak must be higher than the previous peak. If it is absolutely flat--which is next to impossible--or if each trough is lower than the previous trough, then it is not divergent. Yes, it can be falling at a slower rate than the price but this is not a true divergence, at least not one I'd want to bet on. I hope you won't mind my sending you a chart to look at. There's really no way I can explain this just by describing it since your only referent is online charts. <> I think you're confusing divergence with non-confirmation, for want of a better term (it's late). Divergence refers to a divergence between some indicator or other and price, since all indicators are built on price data. On the other hand, when you're trying to decide whether or not to enter a position, you want confirmation from at least one other indicator, since there is no one indicator that can be relied upon that strongly. I think what you're referring to is the condition known as "analysis paralysis", which means that the more you analyze something, the more likely you are to come up with so much contradictory evidence that you can't act (applies to more than charting). The investor is put in the position of having to know enough in order to remove doubt, but not so much that confusion again takes over. As you say, it's a matter of probabilities, or of lining your ducks up all in a row. Even without indicators, we do it all the time as CANSLIMers. Say a stock is in a nice, long base. All indications are that it's likely to break out. The volume has been rising steadily, the spread has become narrower and narrower, the stock has been closing at or near its highs for several days. But the market and the group look terrible. So what are the probabilities? What do you do? Same with indicators. You want confirmation, but you don't want to twist it around six ways from Sunday until nothing you do makes any sense. <> Hey, I wouldn't buy it based on the chart pattern alone. At the very least I'd want to see it clear the 50 and remain there for a couple of days. But I'm not a hot-dogger like you are ;) - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Sat, 06 Jun 1998 20:06:26 -0400 From: Jeffry White <"postwhit@sover.net"@sover.net> Subject: [CANSLIM] Members - a drum roll please - Bill > Date: Fri, 5 Jun 1998 14:13:13 -0700 > From: Bill > Subject: Re: [CANSLIM] Members - a drum roll please > > Jeffrey, you failed to mention the bullish OBV divergence for the month of > March just before the big pop in April! This would have placed EDAC on my > watch list for sure. > My failure to mention OBV is the result of not being able (to date), in a trending market, to find CANSLIM stocks breaking from proper bases or LLUR formations which demonstrate anything but a direct correlation on OBV/MF indicators. Never seen a "divergence" on those indicators on a CANSLIM stock that was under accumulation or climing the ladder of the 20 or 50 day EMA. So, I no longer look for OBV/MF on CANSLIM stocks, just for shorts in apparent "climax runs". I posted my thoughts on this early in the move which began late January, and I think the consensus from this group was that the following seemed to sense: A stock under accumulation should show positive OBV/MF. If not, then maybe your reading of the chart of the particular stock is not accurate and you'd better study it again. I'd be pleased to hear some new thoughts on the topic, but for the time being, I'm sticking with 3/7/10 EMA and slow stochastics to enhance entry point when the "M" is turning or running, using traditional price and volume patterns (and IBD rankings) for determining accumulation and inflow of dough. I've used CM's two indicators effectively for entry point (also used it when it didn't work, of course), and will likely continue using them when the "M" is "ripe". They tend to be a nice pair of forward looking indicators which firm up one of my focal points in CANSLIM: safe entry with a low risk stop placement. JW - - ------------------------------ Date: Sat, 06 Jun 1998 14:38:13 +0200 From: Johan Van Houtven Subject: [CANSLIM] OBV/MF and predicting breakouts (no relation found) Jeffry wrote: >My failure to mention OBV is the result of not being able (to date), in >a trending market, to find CANSLIM stocks breaking from proper bases or >LLUR formations which demonstrate anything but a direct correlation on >OBV/MF indicators. Never seen a "divergence" on those indicators on a >CANSLIM stock that was under accumulation or climing the ladder of the >20 or 50 day EMA. So, I no longer look for OBV/MF on CANSLIM stocks, >just for shorts in apparent "climax runs". I did an extensive study about half a year ago about whether or not OBV/MF could predict the chance of a successful breakout. After putting in a lot of time myself, I asked someone very knowledgeable about breakouts, Henry Brookins, and he confirmed what I had found out myself. There is no relationship whatsoever that is of any use. The ONLY thing that you can look for that might point to a coming successful breakout is "tracks of the elephants". That's it, nothing else. To bad. Johan Van Houtven CLICK! N.V. / Wilrijk, Belgium - - ------------------------------ Date: Sat, 06 Jun 1998 20:57:07 -0400 From: Jeffry White <"postwhit@sover.net"@sover.net> Subject: [CANSLIM] EDAC moving again > Date: Fri, 05 Jun 1998 19:13:16 +0200 > From: Johan Van Houtven > Subject: Re: [CANSLIM] EDAC moving again > > Tim Fisher wrote: > > >Of course I was stopped out 3 weeks ago...that should have been your buy > >signal! > > Up 1 3/6 (16x16.5) on 12400 shares... nothing to write home about > considering the volume. > > > > Johan Van Houtven > CLICK! N.V. / Wilrijk, Belgium > > True Johan, but doesn't it look nice and "dry"? And now take a look at the chart with 3/7/10 EMA and slo stos on the chart. See it? Looks like some measure of short term confirmation of the move having been digested, an absence of selling and a possible resumption of the move to me. What do you think? This is just what I would be looking for (without the indicators) to signal a possible "add" to an open position or, if the "M" were behaving, initiate a position in a stock which is already on the move out of a nice base. I would have liked to see more volume, but with the added comfort of the 3/7/10 and slow stos, and a good "M", I might lean toward giving it a whirl with a much nicer stop placement than your likely going to get if you give the stock a couple of days to run and try an entry before it takes out 18, don't you think? You buy this thing when the volume starts to swell and heads toward 18, where's your 7-10% stop gonna be and how does it look technically as far as the likelihood of getting that order triggered? Particularly important if it doesn't ultimately break out after that volume surge and you have to ride it around for a while? True, if you wait till it breaks 18 and the volume is right, your stop is going to look just as good technically as entering it here, but I prefer the earlier entry on this type of running stock (when the "M" is right, of course) and use the new high as yet another possible "add". I tend NOT to use those two indicators (EMA and Sto crossovers) in front of the initial breakout for obvious reasons (unless they are confirming an unmistakeable volume push off the bottom of a handle, etc.), but for confirming the initial "dry up" after a collosal breakout (on no news or upgrade), for "adds/pyramid buys" or, like I said, when we are trending and possibly looking at an LLUR run, I'll use them to confirm an entry. Additional postive technical behavior is EDAC's respect for the 20 day EMA. Hit it on the head on Thursday, and bounce Friday. BTW, pull up the MACD - lagging... OBV/MF - zero help, IMO... Let's see if the early signals pan out, and where the MACD is at the time they are confirmed or belied by the price action. Disclaimer: Entry point is one of the areas where I likely make a fairly heavy departure from "pure" CANSLIM. However, it has always been one of the most difficult parts of the discipline, for me. I find "getting off the pot" a psychological danger point and a bad entry when the move might appear to be commencing or resuming is where my history with this game reveals the most errors. Once I make a mistake in an issue, I'm destined to make more (like pulling my stop because my entry was technically poor). Consequently, it's one of my perpetual focuses on the "trading" side of CANSLIM. J - - ------------------------------ Date: Fri, 05 Jun 1998 18:37:13 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] 10-Ribbon EMA & DB--Unexpurgated I was afraid that my private response to a private query would be made public, and excerpted to boot. Rather than pick over old bones, I'll just post the original query and response and let it lay. - --Db <> ....... <> No. A "plot" is the placement of a line or an indicator on a chart, i.e., one "plots" a moving average. <> It wasn't Woodward's article. It was an article in February's TASC. Woodward modified it with a 17d EMA and LT EMAs. I mentioned it only because your friend may have read the article and I thought posters might like to read the original. <> I don't save this stuff so I don't know what you're referring to. <> Personally, I think MF and other accumulation-distribution indicators are largely a waste of time, mostly because of how they're calculated. OBV is fine, but crude. It doesn't lend itself to the fine-tuning I find necessary for entry. As far as divergences go, they seem largely imaginary. The divergences shown by stochastics and RSI, when they exist, seem much more telling. As far as slow stochastics and MACD go, I use them myself, along with RSI, filtering each other, along with the Rainbow EMAs. But since this has little to do with CS, I generally don't get into it unless asked. What disturbs me about TA "tricks" is that newbies often use them, find they don't work, then conclude that TA itself doesn't work. This can retard their growth as investors for years. When someone who has been using your techniques for some time asks what "positive divergence" means, I become concerned. Clearly, there are at least a few people who are in the weeds, but this is not being addressed. <> I use the "ribbon" EMAs detailed in the TASC article. Yours are included in the ribbon. <> No, but I think it only reasonable that posters be made aware of alternatives. $40 is not an unreasonable amount to pay for a far more powerful program. The choice is theirs. <> Whether you are successful or not is beside the point. I hope you are. But CS is not meant for daytrading. Be that as it may, and even if CS can be used for daytrading whether it's meant to be or not, yours is not the only voice. It does bother me that your stock selections are often not CANSLIM and that the charting techniques you use and the patterns you look for are not those on which CS encourages one to focus. Newbies have a tough enough time learning the markets without being persuaded that daytrading is generally lucrative, particularly if the methods they're being taught have nothing to do with the subject of the group, i.e., CANSLIM. Whether you contribute or not is up to you and the members of the group, but if I think you're giving dangerous advice, particularly when it comes to novice investors, I reserve the right to state my opinion. Those who depart from the subject of whatever a particular message board or e-mail group is devoted to often feel that a "do your own homework" or similar disclaimer is enough. It is not, particularly when the novice lurkers haven't even begun to learn what "doing your own homework" means. This is why I rarely if ever mention stocks, instead concentrating on helping people learn how to select and evaluate their own stocks as opposed to relying on others' "picks". I still don't understand why you don't use CANSLIM stocks for your examples, but that's your choice which you are free to make. But whatever history you may have with the group, I remind you that new members are added all the time, at least some of whom have only the vaguest idea of what CANSLIM is. As long as there's a possibility that these newcomers might think that your selections are CS and that your techniques for finding entry points are CS, I will question those choices when I think it's appropriate. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Fri, 05 Jun 1998 21:35:34 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] M Thoughts - NASDAQ--Dave < Dave Cameron>> Damn! After all that meditation and all that self-denial, it comes creeping back when I least expect it. Thank you, Dave. I have to go find my cat-o'-nine-tails. Wax on. Wax off. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Sat, 6 Jun 1998 06:37:37 -0700 (PDT) From: rolatzi Subject: Re: [CANSLIM] OBV/MF and predicting breakouts (no relation found) Johan: How do I find tracks of the elephants? Am I missing something? Ciao, Rich - ---Johan Van Houtven wrote: > > After putting in a lot of time myself, I asked someone very knowledgeable > about breakouts, Henry Brookins, and he confirmed what I had found out > myself. There is no relationship whatsoever that is of any use. The ONLY > thing that you can look for that might point to a coming successful > breakout is "tracks of the elephants". That's it, nothing else. To bad. > > > > Johan Van Houtven > CLICK! N.V. / Wilrijk, Belgium _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Sat, 6 Jun 1998 06:44:16 -0700 (PDT) From: rolatzi Subject: Re: [CANSLIM] Members - a drum roll please - Bill Jeffry: I have not gotten into the habit of mind of watching and understanding the market -M. Where do we stand in the count? I think that market analysis is a large part of the battle of picking winning stocks by CANSLIM and would appreciate it if you would post your reading of the current market conditions. Are we in a potential up market again? Thanks, Rolatzi - ---Jeffry White <"postwhit@sover.net"@sover.net> wrote: > > I posted my thoughts on this early in the move which began late January, > and I think the consensus from this group was that the following seemed > to sense: A stock under accumulation should show positive OBV/MF. If > not, then maybe your reading of the chart of the particular stock is not > accurate and you'd better study it again. > > I'd be pleased to hear some new thoughts on the topic, but for the time > being, I'm sticking with 3/7/10 EMA and slow stochastics to enhance > entry point when the "M" is turning or running, using traditional price > and volume patterns (and IBD rankings) for determining accumulation and > inflow of dough. I've used CM's two indicators effectively for entry > point (also used it when it didn't work, of course), and will likely > continue using them when the "M" is "ripe". They tend to be a nice pair > of forward looking indicators which firm up one of my focal points in > CANSLIM: safe entry with a low risk stop placement. > > JW > > - > > _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Sat, 6 Jun 1998 06:58:25 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] EDAC moving again--Jeffry (TA!) <> You and me both, Jeffry. It wasn't so bad in the late 80's, early 90's. But as the PC became more widespread, the internet became commercialized and accessible, and everyone started looking at the same things at the same time, detecting and buying breakouts was about as stealthy as taking out an ad in the paper. When you've got thousands of SOES traders and other daytraders watching your buy go through, no wonder so many breakouts get choked off at 5 or 8%. This is why I began departing from the "buy the breakout" mantra. I found that one can have at least some indications of an impending breakout if he learns how to interpret price and volume and uses a few simple "indicators", like stochastics and very short-term EMAs. The "ribbon" that has been referred to has been most helpful, though I use the one detailed in the TASC article. You may want to consider expanding your 3, 7, 10 to the short-term ribbon. It consists of 3, 5, 8, 10, 12, and 15. If the price is just at, just below, or just above major support such as a base, handle, or major moving average, and the shorter of these begin to cross over the 15 to the upside, you can be fairly certain that something is about to happen (for my taste and risk level, I find the third crossover to be the best compromise). For someone who studies price/volume relationships, this should come as no great surprise. One often sees a volume build-up before the price actually moves. And one can go by that alone. What I like about these EMAs is that I can instruct the computer to scan for them. That saves an amazing amount of time. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Sat, 06 Jun 1998 10:36:25 -0400 From: "Frank V. Wolynski" Subject: Re: [CANSLIM] EDAC moving again--Db & Jeffry (TA!) At 06:58 6/6/98 -0700, dbphoenix wrote: ....sniped... >commercialized and accessible, and everyone started looking at the >same things at the same time, detecting and buying breakouts was about >as stealthy as taking out an ad in the paper. When you've got >thousands of SOES traders and other daytraders watching your buy go >through, no wonder so many breakouts get choked off at 5 or 8%. > >This is why I began departing from the "buy the breakout" mantra. I >found that one can have at least some indications of an impending >breakout if he learns how to interpret price and volume and uses a few >simple "indicators", like stochastics and very short-term EMAs. The >"ribbon" that has been referred to has been most helpful, though I use >the one detailed in the TASC article. > Elders "Trading for a Living" says the Pros (who are they anyway?) "Fade" or short the breakouts. >You may want to consider expanding your 3, 7, 10 to the short-term >ribbon. It consists of 3, 5, 8, 10, 12, and 15. If the price is just >at, just below, or just above major support such as a base, handle, or >major moving average, and the shorter of these begin to cross over the >15 to the upside, you can be fairly certain that something is about to >happen (for my taste and risk level, I find the third crossover to be >the best compromise). For someone who studies price/volume >relationships, this should come as no great surprise. If you don't mind my asking, would you mind expanding on what you mean by the third crossover? I believe you mean the third time the 3 crosses the 15. This would have given ample time for the remaining MA's to tighten up and pretty themselves up in an orderly sort of way for an advance. Is volume significant in the tightening stage? If so, is that what you meant below? If not, will it often times follow the price pattern? >One often sees >a volume build-up before the price actually moves. And one can go by >that alone. What I like about these EMAs is that I can instruct the >computer to scan for them. That saves an amazing amount of time. > >--Db > By "One can go by that alone", do you mean, during the stage preceding the "third crossover" there is volume build up, thus occuring before any breakout in price? I hope you don't mind the questions. I am a student of price/volume patterns myself. Chased there by technical indicators that work on one stock, but not on another, during one market, but not during another. Heck, even don't work on the same stock twice! Frank Wolynski - - ------------------------------ Date: Sat, 6 Jun 1998 08:12:01 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] EDAC moving again--Db & Jeffry (TA!)--Frank <> Sorry, Frank. It's early. What I meant was that the 3 crosses the 15, then the 5 crosses the 15, then the 8 crosses the 15. If you're really aggressive, you could move when the 3 crosses the 5, then they both cross the 8, etc., but unless you're going for fractions of a point, I don't see the advantage. <> Base-building has several functions. If it's the right kind of base, i.e., it's fairly tight and volume is relatively quiet (relatively in terms of what it was before the base began to form), the price level it's at represents what both bulls and bears AT THE TIME think the stock is worth. Bases also serve those who want to accumulate the stock in preparation for an advance. The longer the base, the more time there is. These are two of the reasons why O'N likes long bases. There is also the added benefit that if the base is long enough, it will eventually meet up with the 50d MA and they can stroll into the sunrise together until that old devil volume comes along and seduces price into breaking away and ascending the stairway to paradise, leaving the 50d MA behind to take the bus. OTOH, if volume continues to be high and erratic, it represents an ongoing battle between bulls and bears as to fair value, and you can't know which way the game is going to go regardless of how long the base is. <<>>One often sees a volume build-up before the price actually moves. And one can go by that alone.<< By "One can go by that alone", do you mean, during the stage preceding the "third crossover" there is volume build up, thus occuring before any breakout in price?>> What I meant was that you don't absolutely have to use moving averages or technical indicators or any other aid as long as you have price and volume and a pencil. All indicators are based on price, though many factor in volume as well. Their only function is to enable you to see more clearly what is right in front of you (though some seem designed to make the activity even cloudier than it already is). In fact, I encourage new investors to use nothing but price and volume in order to learn how to detect horizontal price-support and resistance and draw trendlines. I (and, eventually, they) find it far easier to evaluate what indicators are telling them if they know the basics first. It's like painting the kids' room. You can't fix your orange unless you know it's made up of red and yellow. <> Not at all, and what you've noticed is not at all uncommon. Some stocks follow a 50d SMA (simple moving average). Some follow a 50d exponential. Some follow a 40d. While some follow a 200d, others follow a 150. And trendlines change all the time. Which you follow depends on your timeframe and the kind of investor you are. This doesn't mean that you have to change your indicator set with every stock. The time-saving aspect would go right out the window. What you want to do is find something that works most of the time with most stocks (after all, how many stocks can you own?). And if your net catches a stock that just doesn't quite fit one of your plots, maybe just one of your indicators is inappropriate for that particular stock. Or it's the wrong length. In other words, it's not the indicator--it's the fit. If a shoe doesn't fit, it's not the shoe's fault, nor is it yours. If you particularly like the stock for some other reason, you might want to fiddle with your indicator set for that particular stock in order to find what works and what will give you a good entry point. Or you could just blow all this off and stick with price and volume and be far less confused than many investors are. What you do depends in large part on whether you think all this is endlessly fascinating or a monumental pain in the neck (though if the latter, you'd probably be in funds). - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Sat, 6 Jun 1998 09:51:11 -0700 (PDT) From: dbphoenix Subject: [CANSLIM] Re: Groups Some groups to look at: Computers--Optical Recognition All Building groups except for Paint and Wood Products Financial--Consumer/Commercial Loans Financial--Miscellaneous Services Some airlines--like America West and Southwest--look interesting, but with the possibility of rising fuel costs, these are problematic. Other groups, like Supermarkets, also look good, but aren't really CANSLIM. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Sat, 6 Jun 1998 09:58:36 -0700 From: Bill Subject: Re: [CANSLIM] KTIE for JW only! How do you read the action on KTIE? Can this qualify as a 'climax run?' Bill-->> - ------------------------ At 5:06 PM -0700 6/6/98, Jeffry White wrote: snip.. >20 or 50 day EMA. So, I no longer look for OBV/MF on CANSLIM stocks, >just for shorts in apparent "climax runs". > > >JW > >- - - ------------------------------ Date: Sat, 6 Jun 1998 09:58:36 -0700 From: Bill Subject: Re: [CANSLIM] KTIE for JW only! How do you read the action on KTIE? Can this qualify as a 'climax run?' Bill-->> - ------------------------ At 5:06 PM -0700 6/6/98, Jeffry White wrote: snip.. >20 or 50 day EMA. So, I no longer look for OBV/MF on CANSLIM stocks, >just for shorts in apparent "climax runs". > > >JW > >- - - ------------------------------ Date: Sat, 06 Jun 1998 18:32:26 +0200 From: Johan Van Houtven Subject: Re: [CANSLIM] OBV/MF and predicting breakouts (no relation found) Rich wrote: >How do I find tracks of the elephants? Am I missing something? > >Ciao, >Rich Elephants are big animals compared to us ants. The tracks they leave are large volume 'droppings'. Elephants are funds or professional money managers. The individual investors are the ants. Johan Van Houtven CLICK! N.V. / Wilrijk, Belgium - - ------------------------------ End of canslim-digest V2 #271 ***************************** 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.