AW: [CANSLIM] stacking the odds in my favor-buying before the pivot point

From: Andreas Himmelreich <judgejimmy@web.de>
Subject: AW: [CANSLIM] stacking the odds in my favor-buying before the pivot point
Date: Fri, 21 Dec 2001 18:23:18 +0100
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" I believe most serious IT traders are now buying before the breakout as 
it has become a very obvious point"

So how do you determine this "obvious" point?

> -----Ursprungliche Nachricht-----
> Von:	Dave Squires [SMTP:dcsquires1@home.com]
> Gesendet am:	Friday, December 21, 2001 5:17 PM
> An:	canslim@lists.xmission.com
> Betreff:	Re: [CANSLIM] stacking the odds in my favor-buying before the 
pivot  point
>
>  >>I still think that these things could be done with stop-limit orders 
for entry and therefore wouldn't require screen-sitting all day long.<<
>
> I agreed. I have said this many times before on this and other CS lists. 
While I am skeptical about stop limits I think stop market orders placed 
after the first 15-30 minutes will cover people who can't watch the screen 
all day or set alarms. CS requires very good timing and buying the next day 
is often a recipe for a stop out on any normal pullback or pivot test. I 
believe most serious IT traders are now buying before the breakout as it 
has become a very obvious point. Still in a good market with quality 
leadership the handle high pivot will work fine. If you don't have constant 
access to the market buying before the break can be dangerous because you 
don't know the volume situation and you are technically buying the top of a 
trading range, which is a dangerous entry if a breakout does not result.
>
> DSquires
>   ----- Original Message -----
>   From: Katherine Malm
>   To: canslim@lists.xmission.com
>   Sent: Friday, December 21, 2001 9:07 AM
>   Subject: Re: [CANSLIM] stacking the odds in my favor-buying before the 
pivot point
>
>
>   Good question, Warren. It is at this very spot where "theory" and 
"practice" meet that the individual has to apply some reasonable 
assumptions, analytical tools, and executable steps. A fancy way of saying, 
"I know that price has a probability of moving up when demand outstrips 
supply, and I can use chart patterns to identify that point." But....for 
each person, that "point" may be a little different. I think that's what 
Tom has been referring to in his own posts. He has a comfort with microcaps 
and under-followed stocks in general, so he has adjusted his entries to 
match the typical behavior of these stocks. As I have become more 
comfortable with technical patterns and more confident in my own candidate 
selection process, I have modified these entries a bit. I am much more 
willing to take entries on patterns other than the traditional C&H or flat 
base near old highs. I control risk by decreasing my lot size and then 
adding to positions as the stock continues to show strength and then pulls 
back to the intermediate term trend. That's not to say I don't have to pull 
the plug every now and then, and then possibly re-enter when the smoke 
clears. But that's about personal style in the spirit of CANSLIM and in the 
spirit of "the balance between supply and demand." In general, I still 
think that these things could be done with stop-limit orders for entry and 
therefore wouldn't require screen-sitting all day long. I have the luxury 
of being at home all day as well, but I really don't find it interesting to 
"watch" the market. I let my alarms tell me when/if the time is near, then 
place a market order when it's right. Again, personal style, but not a 
requirement.
>
>   Katherine
>     ----- Original Message -----
>     From: Warren Keuffel
>     To: canslim@lists.xmission.com
>     Sent: Friday, December 21, 2001 8:47 AM
>     Subject: Re: [CANSLIM] stacking the odds in my favor-buying before 
the pivot point
>
>
>     Katherine,
>
>     This is the Theory, and it is Good.  But in Practice, being able to
>     identify the B/O and get in before it is too extended is where the
>     rubber really meets the road.  Hence, I am starting to favor an 
earlier
>     entry (and I believe Tom mentioned that he does this as well) because
>     IMHO only those glued to their screens all day long, with sophisti  
cated
>     alarms, etc. can react quickly enough to act at the ideal entry 
point.
>
>     Maybe it's not as hard as I make it out to be, but I have not had 
many
>     successes with ideal entry points, and I work from home so am seldom 
far
>     from my computer.  How about you?  Are you able to repeatably time 
your
>     entries optimally?
>
>     Warren
>
>     Katherine Malm wrote:
>
>     <snip>
>
>     >  (1) The idea behind waiting for a good stock to form a solid base 
and
>     > then break out on volume is to identify that magical point at which
>     > Demand outstrips Supply and Price is pushed higher--essentially the
>     > old Supply/Demand curve from economics class.  Assuming the lion's
>     > share of  sellers have been exhausted and the stock is one that 
people
>     > would wish to own, the theory is that any additional demand for the
>     > stock will push the price further. In order for the Price to 
continue
>     > on, the underlying fundamentals that create value in the company 
have
>     > got to be sound. So from this point of view, waiting for the B/O is
>     > stacking the odds in your favor.
>
>     <snip>
>
>
>
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