Go to Jeff Salisbury LWGate Home Page.From: "walter nusbaum" <wnusbaum@airmail.net>
Subject: Re: [CANSLIM] Panic attack ...
Date: Thu, 24 Jan 2002 13:57:54 -0600
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Ian,
You are absolutely correct. My bad. 1.5 is indicative of an upturn. =
After a perfunctory reading of the section on TRIN, I failed to read the =
instructions for the *construction* of the scale, which calls for an =
inversion of the numbers. Hence the low numbers are on top and the high =
on the bottom with the Overbought line on top and the Oversold line =
underneath. I apologize for the error. Thanks for your correction.
It would seem that you and Tom are about the only (outspoken) Bulls on =
the board, and both in microcaps. Hmmm! Interestingly, "investor =
sentiment" shows Bulls leading the Bears by a very wide margin(53%-24%). =
Recently, Ford laid off 35,000 workers and closed a couple of plants; =
Orlando's hotels are in serious trouble: then there's Enron and =
Kmart(who's next and how many more?). On a personal note, I just =
returned from my second trip to Vegas in four months and the gaming =
business is struggling, while the nickel slots were doing a land office =
business; the Imperial Palace on the strip was advertising $10/night =
rooms for the locals, etc. Anyway, I'm sitting in all cash waiting for =
that other shoe(I'm pretty certain that I heard the first). Thanks =
again.
Best wishes,
Walt
=20
=20
----- Original Message -----=20
From: Ian=20
To: canslim@lists.xmission.com=20
Sent: Thursday, January 24, 2002 12:26 PM
Subject: Re: [CANSLIM] Panic attack ...
Walt:
My only interest in TRIN readings is in when it reaches extreme =
sustained historical highs - which I take to indicate exhaustion selling =
- - meaning it will be followed by a significant upturn. These readings =
are very rare - so there is no way I would look to TRIN for short-term =
wiggles.
That being said, I am surprised that you think the extreme panic =
recently indicated means that "it will probably be followed by a =
downturn". Why would you think that? My take is that it signals that we =
are running out of indiscriminate sellers.
I believe that the recent strong volatility in both directions is =
indicative of the beginnings of a new bull. IMHO, it is needed to =
separate out the most tired of the last bulls winners - those are the =
ones that drop in the selloffs, but dont rebound strongly in the surges.
I find it interesting that most on this board are quite bearish, while =
I find myself with the lowest cash position in well over a year, and a =
growing supply of buyer-friendly microcaps.
Cheers,
Ian
----- Original Message -----=20
From: Tom Worley=20
To: canslim@lists.xmission.com=20
Sent: Wednesday, January 23, 2002 10:37 AM
Subject: Re: [CANSLIM] Panic attack ...
Walter,
I would have to disagree with part of your conclusion. While the =
housing industry did not prevent the start of a recession, it is likely =
that it significantly helped to make it a shallow recession, and will =
help end it early. There still seems to be a lot of juice left in the =
home builders group, and I was adding more to my three positions in my =
fund today. Adding to Consumer Sentiment, in addition to lower mortgage =
payments, is lower energy costs. That, plus the tax cuts that started =
1/1/02, means a little more money in everyone's paycheck or wallet.
Tom Worley
stkguru@netside.net
AIM: TexWorley
----- Original Message -----=20
From: walter nusbaum=20
To: canslim@lists.xmission.com=20
Sent: Wednesday, January 23, 2002 11:58 AM
Subject: Re: [CANSLIM] Panic attack ...
Ian,
"Stock Market Cycles" was rated "F" in up markets and A+ in down =
markets with an annualized gain of 4.6% since 5/31/90(sic), according to =
Forbes(22 JAN 01); not exactly the kind of numbers that inspire =
confidence. At any rate, there is nothing in the theory or construction =
of TRIN that allows for speculation as to the degree of market change. =
It is a great market reversal indicator and that's all. According to =
Elder, the market can stay over bought/sold for some time and the time =
to take action is immediately after TRIN makes a reversal off its =
high/low reading and re-penetrates the overbought or oversold line.(The =
Equis link says to buy/sell upon reaching the line, which is a specific =
number. Elder's recommendation puts you in sync with the new trend. I =
don't know what TRIN was doing during the debacle of 2000, but I =
suspect(using the Equis standard) it gave buy signals loooong before =
their time).
The lines themselves should be revisited, and redrawn if =
necessary, every three months based upon the interaction of TRIN and the =
Index that is being used. The lines indicate areas of concern and =
specific numbers above or below the lines have little meaning. TRIN can =
not be used mechanically- the same readings mean different things under =
different market conditions(Bull/Bear). TRIN gives its best buy/sell =
signals when divergence from the Index being used is observed and when =
used in combination with the New High-New Low Index.=20
Having said all that, 1.5 is a doozy of a number and will probably =
be followed by a downturn. I know nothing, but have little confidence in =
a return of the Bull for many moons. The automobile industry with its =
attendant suppliers such as steel, glass, rubber, plastics, etc., has =
been trashed; housing has typically propelled the new Bull, but housing =
has already had its own run with little effect on the overall market. =
Consumer Confidence would seem to be a bright spot, but it probably is =
the result of lower mortgage payments due to massive refinancing and =
bargains picked up by consumers at the expense of the producers, the =
very folks that we look to for increased earnings. There's more, but =
this grows lengthy so I'll shut up. Thanks for your note.
Best wishes,
Walt
=20
----- Original Message -----=20
From: Ian=20
To: canslim@lists.xmission.com=20
Sent: Tuesday, January 22, 2002 12:32 PM
Subject: [CANSLIM] Panic attack ...
Here's a very interesting recent quote from Peter Eliades of =
Stock Market Cycles: "At the end of todays trading, we noticed that the =
lowest single day TRIN reading over the past 10 trading days was 1.143. =
That seemed unusual to us, so we asked the computer to look back over =
the past 61 years (since 1940) to find out how many other 10 day periods =
had transpired without one single day reading below 1.14. We were =
stunned at the answer! The answer is none."
The 10 day ARMS index (TRIN) got up to 1.5 again last week. It =
used to have huge historical significance in indicating that a major =
bottom was to be put in within 20 trading days. It has now happened 4 =
times in the past year alone.
I don't pretend to know what it means, but there certainly has =
been a considerable amount of panic over the last 2 weeks.
Ian
PS - Here is a quick overview of the ARMS index that someone =
asked for: http://www.equis.com/free/taaz/armsindex.html
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<DIV><FONT size=3D2>Ian,</FONT></DIV>
<DIV><FONT size=3D2>You are absolutely correct. My bad. 1.5 is =
indicative of an=20
upturn. After a perfunctory reading of the section on TRIN, I failed=20
to read the instructions for the *construction* of =
the=20
scale, which calls for an inversion of the numbers. Hence the low=20
numbers are on top and the high on the bottom with the Overbought =
line on=20
top and the Oversold line underneath. I apologize for the error. Thanks=20
for your correction.</FONT></DIV>
<DIV><FONT size=3D2></FONT> </DIV>
<DIV><FONT size=3D2>It would seem that you and Tom are about the only =
(outspoken)=20
Bulls on the board, and both in microcaps. Hmmm! Interestingly, =
"investor=20
sentiment" shows Bulls leading the Bears by a very wide margin(53%-24%). =
Recently, Ford laid off 35,000 workers and closed a couple of plants; =
Orlando's=20
hotels are in serious trouble: then there's Enron and Kmart(who's next =
and how=20
many more?). On a personal note, I just returned from my second =
trip to=20
Vegas in four months and the gaming business is struggling, while the =
nickel=20
slots were doing a land office business; the Imperial Palace on the =
strip was=20
advertising $10/night rooms for the locals, etc. Anyway, I'm sitting in =
all cash=20
waiting for that other shoe(I'm pretty certain that I heard the =
first).=20
Thanks again.</FONT></DIV>
<DIV><FONT size=3D2>Best wishes,</FONT></DIV>
<DIV><FONT size=3D2>Walt</FONT></DIV>
<DIV><FONT size=3D2> </FONT></DIV>
<DIV><FONT size=3D2></FONT> </DIV>
<DIV><FONT size=3D2> </FONT></DIV>
<BLOCKQUOTE dir=3Dltr=20
style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; =
BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
<DIV style=3D"FONT: 10pt arial">----- Original Message ----- </DIV>
<DIV=20
style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: =
black"><B>From:</B>=20
<A title=3Dianstm@shaw.ca href=3D"mailto:ianstm@shaw.ca">Ian</A> =
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>To:</B> <A =
title=3Dcanslim@lists.xmission.com=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Thursday, January 24, =
2002 12:26=20
PM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> Re: [CANSLIM] Panic =
attack=20
...</DIV>
<DIV><BR></DIV>
<DIV><FONT size=3D2>Walt:</FONT></DIV>
<DIV> </DIV>
<DIV><FONT size=3D2>My only interest in TRIN readings is in =
when it reaches=20
extreme sustained historical highs - which I take to indicate =
exhaustion=20
selling - meaning it will be followed by a significant upturn. These =
readings=20
are very rare - so there is no way I would look to TRIN for =
short-term=20
wiggles.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT size=3D2>That being said, I am surprised that you think the =
extreme=20
panic recently indicated means that "it will probably be followed by a =
downturn". Why would you think that? My take is that it signals that =
we are=20
running out of indiscriminate sellers.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT size=3D2>I believe that the recent strong volatility in =
both=20
directions is indicative of the beginnings of a new bull. IMHO, it is =
needed=20
to separate out the most tired of the last bulls winners - those are =
the ones=20
that drop in the selloffs, but dont rebound strongly in the=20
surges.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT size=3D2>I find it interesting that most on this board are =
quite=20
bearish, while I find myself with the lowest cash position in well =
over a=20
year, and a growing supply of buyer-friendly microcaps.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT size=3D2>Cheers,</FONT></DIV>
<DIV> </DIV>
<DIV><FONT size=3D2>Ian</FONT></DIV>
<DIV> </DIV>
<DIV> </DIV>
<BLOCKQUOTE dir=3Dltr=20
style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; =
BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
<DIV style=3D"FONT: 10pt arial">----- Original Message ----- </DIV>
<DIV=20
style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: =
black"><B>From:</B>=20
<A title=3Dstkguru@netside.net =
href=3D"mailto:stkguru@netside.net">Tom=20
Worley</A> </DIV>
<DIV style=3D"FONT: 10pt arial"><B>To:</B> <A =
title=3Dcanslim@lists.xmission.com=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
=20
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Wednesday, January 23, =
2002 10:37=20
AM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> Re: [CANSLIM] Panic =
attack=20
...</DIV>
<DIV><BR></DIV>
<DIV><FONT face=3DArial>Walter,</FONT></DIV>
<DIV><FONT face=3DArial></FONT> </DIV>
<DIV><FONT face=3DArial>I would have to disagree with part of your =
conclusion.=20
While the housing industry did not prevent the start of a recession, =
it is=20
likely that it significantly helped to make it a shallow recession, =
and will=20
help end it early. There still seems to be a lot of juice left in =
the home=20
builders group, and I was adding more to my three positions in my =
fund=20
today. Adding to Consumer Sentiment, in addition to lower mortgage =
payments,=20
is lower energy costs. That, plus the tax cuts that started 1/1/02, =
means a=20
little more money in everyone's paycheck or wallet.</FONT></DIV>
<DIV> </DIV>
<DIV>Tom Worley<BR><A=20
href=3D"mailto:stkguru@netside.net">stkguru@netside.net</A><BR>AIM:=20
TexWorley</DIV>
<BLOCKQUOTE dir=3Dltr=20
style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; =
BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
<DIV style=3D"FONT: 10pt arial">----- Original Message ----- =
</DIV>
<DIV=20
style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: =
black"><B>From:</B>=20
<A title=3Dwnusbaum@airmail.net =
href=3D"mailto:wnusbaum@airmail.net">walter=20
nusbaum</A> </DIV>
<DIV style=3D"FONT: 10pt arial"><B>To:</B> <A=20
title=3Dcanslim@lists.xmission.com=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
=20
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Wednesday, January =
23, 2002=20
11:58 AM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> Re: [CANSLIM] =
Panic attack=20
...</DIV>
<DIV><BR></DIV>
<DIV><FONT size=3D2>Ian,</FONT></DIV>
<DIV><FONT size=3D2>"Stock Market Cycles" was rated "F" in up =
markets and A+=20
in down markets with an annualized gain of 4.6% since=20
5/31/90(sic), according to Forbes(22 JAN 01); not =
exactly the=20
kind of numbers that inspire confidence. At any rate, =
there is=20
nothing in the theory or construction of TRIN that allows for =
speculation=20
as to the degree of market change. It is a great market reversal=20
indicator and that's all. According to Elder, the market can =
stay=20
over bought/sold for some time and the time to take action is =
immediately=20
after TRIN makes a reversal off its high/low reading and =
re-penetrates the=20
overbought or oversold line.(The Equis link says to buy/sell =
upon=20
reaching the line, which is a specific number. Elder's =
recommendation puts=20
you in sync with the new trend. I don't know what TRIN was doing =
during=20
the debacle of 2000, but I suspect(using the Equis =
standard) it gave=20
buy signals loooong before their time).</FONT></DIV>
<DIV><FONT size=3D2></FONT> </DIV>
<DIV><FONT size=3D2>The lines themselves should be revisited, =
and=20
redrawn if necessary, every three months based upon the =
interaction of=20
TRIN and the Index that is being used. The lines indicate areas of =
concern=20
and specific numbers above or below the lines have little=20
meaning. TRIN can not be used mechanically- the same readings =
mean=20
different things under different market=20
conditions(Bull/Bear).</FONT> <FONT size=3D2>TRIN gives its =
best=20
buy/sell signals when divergence from the Index being used is =
observed and=20
when used in combination with the New High-New Low =
Index.=20
</FONT></DIV>
<DIV><FONT size=3D2></FONT> </DIV>
<DIV><FONT size=3D2>Having said all that, 1.5 is a doozy of a =
number=20
and will probably be followed by a downturn. I know =
nothing, but=20
have little confidence in a return of the Bull for many moons. The =
automobile industry with its attendant suppliers such as steel, =
glass,=20
rubber, plastics, etc., has been trashed; housing has typically =
propelled=20
the new Bull, but housing has already had its own run with =
little=20
effect on the overall market. Consumer Confidence would seem to be =
a=20
bright spot, but it probably is the result of lower mortgage =
payments due=20
to massive refinancing and bargains picked up by consumers at the =
expense=20
of the producers, the very folks that we look to for increased =
earnings.=20
There's more, but this grows lengthy so I'll shut up. Thanks =
for your=20
note.</FONT></DIV>
<DIV><FONT size=3D2>Best wishes,</FONT></DIV>
<DIV><FONT size=3D2>Walt</FONT></DIV>
<DIV><FONT size=3D2> </FONT></DIV>
<BLOCKQUOTE dir=3Dltr=20
style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; =
BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
<DIV style=3D"FONT: 10pt arial">----- Original Message ----- =
</DIV>
<DIV=20
style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: =
black"><B>From:</B>=20
<A title=3Dianstm@shaw.ca href=3D"mailto:ianstm@shaw.ca">Ian</A> =
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>To:</B> <A=20
title=3Dcanslim@lists.xmission.com=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
=20
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Tuesday, January =
22, 2002=20
12:32 PM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> [CANSLIM] Panic =
attack=20
...</DIV>
<DIV><BR></DIV>
<DIV><FONT size=3D2>Here's a very interesting recent quote from =
Peter=20
Eliades of Stock Market Cycles: "At the end of todays trading, =
we=20
noticed that the lowest single day TRIN reading over the past 10 =
trading=20
days was 1.143. That seemed unusual to us, so we asked the =
computer to=20
look back over the past 61 years (since 1940) to find out how =
many other=20
10 day periods had transpired without one single day reading =
below 1.14.=20
We were stunned at the answer! The answer is none."</FONT></DIV>
<DIV> </DIV>
<DIV><FONT size=3D2>The 10 day ARMS index (TRIN) got up to 1.5 =
again last=20
week. It used to have huge historical significance in indicating =
that a=20
major bottom was to be put in within 20 trading days. It has now =
happened 4 times in the past year alone.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT size=3D2>I don't pretend to know what it means, but =
there=20
certainly has been a considerable amount of panic over the last =
2=20
weeks.</FONT></DIV>
<DIV> </DIV>
<DIV><FONT size=3D2>Ian</FONT></DIV>
<DIV><FONT size=3D2></FONT> </DIV>
<DIV> </DIV>
<DIV><FONT size=3D2>PS - Here is a quick overview of the ARMS =
index that=20
someone asked for: <A=20
=
href=3D"http://www.equis.com/free/taaz/armsindex.html">http://www.equis.c=
om/free/taaz/armsindex.html</A></FONT><FONT=20
face=3DArial=20
size=3D2></DIV></BLOCKQUOTE></BLOCKQUOTE></BLOCKQUOTE></BLOCKQUOTE></FONT=
></BODY></HTML>
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