AW: [CANSLIM] Industry group movements.

From: Andreas Himmelreich <judgejimmy@web.de>
Subject: AW: [CANSLIM] Industry group movements.
Date: Sun, 17 Feb 2002 16:13:18 +0100
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Hi,

Once again a quote from http://beta.dailygraphs.com/tutorials/b04a.asp =
- -->

"Here's a case where herd mentality works to your advantage. Studies =
show=20
37% of a stock's move is directly tied to the performance of the =
industry=20
the stock is in. Another 12% is due to strength in its overall sector."

I put a file to http://WallStreet-LLC.com/pub/IGfiles.zip, which shows =
the=20
correlation in an example. I found hundreds of them and still find them=20
every day. Basically you can take the chart patterns and apply them to=20
industry groups and you will find very strong and dependable trends =
where=20
false breakouts take place, but much less then with individual stocks.

Here and example on the short side:

http://WallStreet-LLC.com/pub/IGShortexample.zip

Here an example for an IG that sets up a bull market for its members:

http://WallStreet-LLC.com/pub/BullmarketforBuilders.zip

Important is: Price and RS need to make new highs (lows for shorting) =
our=20
of a base for a buy signal. For the long side I like IGs that cross RS =
of=20
60 to 70.
On the short side crossing RS of 30.

But it can be also very profitable to get into trends that are well=20
established, e.g. where the RS is above 90, but then be sure that you =
wait=20
for a second price and RS base and a second Breakout to get in and be =
rigid=20
if the group shows sell signals.

Best Regards

Andreas





And this is perfectly canslim, because Oneil states that if you go with =
a=20
breakout, look if other stocks out of the group have or had a breakout =
as=20
well ...






> -----Urspr=FCngliche Nachricht-----
> Von:	Gary A. Snyder [SMTP:gas175k@hotmail.com]
> Gesendet am:	Sunday, February 17, 2002 2:30 PM
> An:	canslim@lists.xmission.com
> Betreff:	[CANSLIM] Industry group movements.
>
>
>
>
>
> I am fascinated by industry group movement but can't figure out what =
move =0D
> groups up and down. For example: EPIQ is for sure a fine investment =
and I =0D
> have owned it but the last big move it made from about 13 to 25 the=20
industry
> group moved from at least the lower B group to 30-32. If the industry=20
group
> had not moved EPIQ would still be building a base. In the same group =
BARZ =0D
> went from 35 to 55, ADVS 29 to 51, FIC 39 to 63, BSYS 44 to 63. Even=20
thought
> these companies offer completely different software to the financial
> industry. A few months ago IBD used GNSS, a semi manufacture, as an=20
example
> of a successful cup and handle but failed the mention that the =
industry
> group started up from a e rating and worked its way up to at least the =

mid b
> rating, against WON rule look in the top sixty groups.  Not just GNSS, =

all
> the semi manufacturing stocks were going up even if they were over =
bought=20
by
> as much as 50%. You may think that you are picking good companies and =
you =0D
> are but they are not going anywhere until the industrial group is =
going=20
up.
> So what moves these industry groups? Some are easy to figure: defense
> stocks- government spending to increase dramatically per purposed =
budget. =0D
> Safety and security- the terrorist effect. Any computer group a month=20
ago- I
> don't have a clue. You don't want to know how poorly some of these=20
security
> companies were rated when they started moving up and they are not
> fundamentally good companies but that doesn't matter if the market=20
perceives
> future growth. Some of these security companies have very poor=20
fundamentals
> but that does not stop them from going through the roof if the =
industry
> group is on the rise. The rating on some of these companies look great
> now(after the fact). Lower oil prices helped the success of
> transportation/trucking even in a bad economy but if the price of oil=20
goes
> up for any of a number of reasons, number one being Iraq targeted as =
the
> next enemy on the war on terrorism transportation/trucking will go =
down=20
so
> fast only bested by oil&gas/any company with proved oil reserves going =

up.
> You don't have to pick the best company in the group. Throw a dart at =
any =0D
> company on the list for success. Home builders: low interest rates,
> increased new home sales, increased building permits but let the =
interest =0D
> rates go up a little and home builders start correcting along with =
home
> mortgage businesses and banks living on refinancing income. In fact =
let=20
an
> influential analysis say interest rates have bottomed and all these=20
groups
> start down no proof needed.Good companies along with bad. I'm confused =

and
> bloodied but feel one key is tracking industry groups. I ask for =
comment
> and/or instruction. gas175k
>
>
>
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