[CANSLIM] industry groups continued

From: "Gary A. Snyder" <gas175k@hotmail.com>
Subject: [CANSLIM] industry groups continued
Date: Tue, 19 Feb 2002 06:15:27 -0500

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John and group:
I just KNOW the importance of ig. moves I just can't track igs.
If you want more examples I'm sure I can find hundreds. I used Computer 
software/finc. because I owned EPIQ. and when someone brought up EPIQ. it 
lit me up. Well another is semiconductor manufactures even when most of the 
companies in that group expect to be down 20% to 50% from last years 
earnings and were over bought big time from their target price they still 
went up when the ig. went up or in other words when the market trend was in 
favor for tech a few months ago.
Just look at the charts of the stocks that I named in that industrial group 
of computer software/finc. Admittedly they did not all go up as much or 
quite at the same time but at this point I would have loved to been in any 
or all of those stocks. EPIQ specializes in bankruptcy software to the 
banking industry while BARZ offers software to the banking industry - EPIQ 
would seem to thrive in a recession and BARZ in a health economy - they both 
heard the siren song of a ig. going up. The example was to show the effect 
of ig. movement on good stocks in that ig. not great stocks just good 
stocks. Not one or two leaders but all of the companies in the example I 
gave and I bet a lot more. I agree in the CANSLIM methodology one sacrifices 
much of a igs. and stocks price move up hoping that the ig. will stay high 
and that the companies will continue to go up. In this environment that 
scenario is a risky undertaking. This is why WON says only in a BULL market. 
Risky because betting the ig. will stay up for any length of time is a poor 
bet and that any stock will continue to advance is also unlikely. I am 
finding it very easy to identifying  stocks that extended over their 50 day 
average and just KNOW they are going to correct. Example: FCN. This is from 
memory:  FCN was making a very nice move up but I saw it got way up from its 
50 day average and I thought: This company is ripe for a correction. Bam 
down it goes.
OK: So what.
I want to catch igs. on the way up because I invest long. I think this 
mythology is not quite WON but we should all be on vacation per WON in this 
market. I track the daily movements of the ig. for the stocks I own and 
can't make any sense of it. The ig. goes up, my stock goes down, ig. goes 
down my stock goes up, some igs. go up or down 20-40 places in one day!!!, 
but feel this is the environment where igs make big moves up (long) or down 
(short) and I can make money if I can identify the ig. and not stay in any 
one ig. for too long a time to cut risk but at this point the only 
observation I can make is WOW: Look at all the computer ig.s in the top 
ten(6 on Jan 15, 2002). In other words big surprise, and Feb.15,2002 Wow: 
only three: 50% chance I could have guessed wrong.
  gas175










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