RE: [CANSLIM] A short ride

From: "Duke Miller" <dukemill@tampabay.rr.com>
Subject: RE: [CANSLIM] A short ride
Date: Fri, 8 Mar 2002 09:42:40 -0500
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Mike:

If I may, some observations (albeit laced with a touch of cynicism, which I
hope is acceptable herein...in moderation, of course...).

My recollection is, Mike, is to expect just that scenario you've described
below, but ONLY when it CLOSES at the BOTTOM of the fall on high volume.
Which poses a question:  If it's noon, the stock is trading in the bottom of
it's range on high volume, should you sell? (Those of you who use stops
don't need to answer that...you're out already!)  But what if it rebounds an
hour later, and subsequently closes down somewhat, but higher than where it
was at noon?  Did I screw up selling too soon?  The answer:  See tomorrow's
chart, then decide!  Then you'd find that what it did (pullback slightly
after breakout) was normal!

"Remember when's" are more the rule than the exception these days.  A few
recent examples:

How many remember this one (from my notes at a seminar ten years ago): "Only
buy a stock after it CLOSES above its breakout on 150% or greater volume.
Then buy it at the next day's opening price."  Hmm.  I know the volatile
90's necessitated a change, but the shakeouts I've encountered since
January1 have caused me to reflect on this old rule.

Then, just the other day, in Investor's Corner, "Only buy a stock within 5%
of its pivot point, unless it gaps up at the open."  So if it gaps up at the
open is it okay to buy it if it's up 10% mid-day?  I think I know the
answer:  Only if TOMORROW's says you should have.

Then comes this a.m.'s Big Picture: "Defense contractors, home builders and
some retailers that defied the market's recent correction are too extended
above their prior bases to buy without risking a shakeout."  I distinctly
remember a recent comment therein that these are the stocks to consider,
because they're done so well in a down market!  You know, high Relative
Strength?

Finally, and hopefully this is only bordering on blasphemy:  Today's
Investors Corner says:  "IBD founder William O'Neil says he's right only
about half the time.  The secret to his success?  At an IBD advanced seminar
last year, O'Neil said he's kept his losses at an average of about 4%.  But
when he finds a winner...."  Excuse me, isn't 4% about half the 8%
"insurance" he recommends?  Could this be a misprint?

I know this only proves we're all constantly developing our own variances on
a theme.  It's like I told my wife this morning:  "You know, I think I'm
going to get this whole process nailed down to perfection the day before I
leave this world!"  Ain't hindsight a wonderful thing?  Now where did I put
tomorrow's charts???

Happy hunting...

Duke


> -----Original Message-----
> From: owner-canslim@lists.xmission.com
> [mailto:owner-canslim@lists.xmission.com]On Behalf Of Mike Lucero
> Sent: Friday, March 08, 2002 5:51 AM
> To: canslim@lists.xmission.com
> Subject: Re: [CANSLIM] A short ride
>
>
> I seem to remember an article where they said don't worry if a stock falls
> hard back toward it's pivot, even on increasing volume. Hmm.
>
> Mike
> ----- Original Message -----
> From: "Bill Triffet" <btriffet@earthlink.net>
> To: <canslim@lists.xmission.com>
> Sent: Thursday, March 07, 2002 11:47 AM
> Subject: Re: [CANSLIM] A short ride
>
>
> Oops sorry Mike. I meant to get back to you. Thankfully Katherine
> stepped up
> to the plate with the article.
> Btw, today's action confirms the failed breakout. Looked like a
> great stock
> at the time though...
>
> -Bill
>
> ----- Original Message -----
> From: "Katherine Malm" <kmalm@earthlink.net>
> To: <canslim@lists.xmission.com>
> Sent: Thursday, March 07, 2002 11:26 AM
> Subject: Re: [CANSLIM] A short ride
>
>
> Hi Mike,
>
> I've uploaded a copy of the article to:
>
> http://WallStreet-LLC.com/pub/BreakoutReversals030602.jpg
>
> Katherine
>   ----- Original Message -----
>   From: Mike Lucero
>   To: canslim@lists.xmission.com
>   Sent: Wednesday, March 06, 2002 7:09 PM
>   Subject: Re: [CANSLIM] A short ride
>
>
>   What did it say?
>   ----- Original Message -----
>   From: "Bill Triffet" <btriffet@earthlink.net>
>   To: <canslim@lists.xmission.com>
>   Sent: Wednesday, March 06, 2002 12:27 PM
>   Subject: Re: [CANSLIM] A short ride
>
>
>   UOPX sure looks like another example of today's Investors
> Corner - Beware
> Of
>   Reversal On Breakout. A tail with large volume. I got out as well.
>
>   -Bill Triffet
>
>
>   ----- Original Message -----
>   From: "Tim Fisher" <Tim@orerockon.com>
>   To: <canslim@mail.xmission.com>
>   Sent: Wednesday, March 06, 2002 9:37 AM
>   Subject: [CANSLIM] A short ride
>
>
>   > Well that was certainly a short ride with UOPX and POSS.
> Makes me wonder
>   > whether this is a big cap rally now. All after I put in orders for the
>   open
>   > today for NTBK and RBMG (neither of which is following suit,
> thankfully).
>   > Anyway just really wanted to test the server since I don't
> see any email
>   > from the group today.
>
>
>
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