Go to Jeff Salisbury LWGate Home Page.From: "david frank" <camelot.homes@charter.net>
Subject: Re: [CANSLIM] A short ride
Date: Fri, 8 Mar 2002 10:25:04 -0600
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that gap strategy didn't work well on the recent breakout of UOPX. WON =
is talking about a 4% average loss-he just goes with the flow-it is =
silly to take a 8% loss on each losing position. my problem with DGO =
- -doesn't show enough of the left side to see if there was a previous =
base. david
----- Original Message -----=20
From: Katherine Malm=20
To: canslim@lists.xmission.com=20
Sent: Friday, March 08, 2002 9:18 AM
Subject: Re: [CANSLIM] A short ride
Hi Duke,
Just a couple of misc. comments to add to your post:
On gaps up---This is an excellent entry strategy when the stock gaps =
open out of a base and on earnings news. The best way to catch them is =
to know which stocks are basing, are due to announce earnings, then =
place a buy stop-limit, or be ready to take action live on the B/O that =
morning. In general, stocks that gap up on strong volume and earnings =
news will continue that move, so I don't hesitate to take them even if =
they are beyond the 5% of pivot rule if the stock has all the right =
characteristics. (I picked up this trick from a '96 IBD article on gaps, =
later reinforced by Gary Kaltbaum's gap strategy)
On WON's 4% losses--at both the IBD seminars I attended, I remember =
comments from WON and his presenters in which they noted that they were =
able to spot whether a breakout was going to work almost immediately. =
They are so good at reading Price/Volume action that they can know =
whether they are wrong about a breakout long before it hits the 8% rule. =
I've also heard this same comment from other CANSLIM-style hedge fund =
managers such as Greg Kuhn, Tim Truebenbach and Kevin Marder. The second =
thing they do is to set a sell rule that will not allow them *any* loss =
once a stock has successfully broken out. So, if the stock breaks out =
and then retraces on light volume to the pivot, fine. But if the =
breakout succeeds and then begins to fail on high volume, they are out =
long before it retraces and at the very least, out at purchase price. I =
think these are subtleties lost when CANSLIMers automatically assume =
that every purchase should be protected with *exactly* an 8% loss. I =
think the sell rules are more complex than that, but that doesn't mean =
they aren't consistent or repeatable.
Katherine
----- Original Message -----=20
From: Duke Miller=20
To: canslim@lists.xmission.com=20
Sent: Friday, March 08, 2002 8:42 AM
Subject: RE: [CANSLIM] A short ride
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.
>
>
>
> -
> -To subscribe/unsubscribe, email "majordomo@xmission.com"
> -In the email body, write "subscribe canslim" or
> -"unsubscribe canslim". Do not use quotes in your email.
>
>
> -
> -To subscribe/unsubscribe, email "majordomo@xmission.com"
> -In the email body, write "subscribe canslim" or
> -"unsubscribe canslim". Do not use quotes in your email.
>
>
>
>
> -
> -To subscribe/unsubscribe, email "majordomo@xmission.com"
> -In the email body, write "subscribe canslim" or
> -"unsubscribe canslim". Do not use quotes in your email.
>
>
>
> -
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> -In the email body, write "subscribe canslim" or
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>
-
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<DIV><FONT face=3DArial size=3D2>that gap strategy didn't work well on =
the recent=20
breakout of UOPX. WON is talking about a 4% average loss-he just goes =
with the=20
flow-it is silly to take a 8% loss on each losing position. my problem =
with DGO=20
- -doesn't show enough of the left side to see if there was a previous =
base.=20
david</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=3Dkmalm@earthlink.net =
href=3D"mailto:kmalm@earthlink.net">Katherine=20
Malm</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> Friday, March 08, 2002 =
9:18=20
AM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> Re: [CANSLIM] A short =
ride</DIV>
<DIV><BR></DIV>
<DIV>Hi Duke,</DIV>
<DIV> </DIV>
<DIV>Just a couple of misc. comments to add to your post:</DIV>
<DIV> </DIV>
<DIV>On gaps up---This is an excellent entry strategy when the stock =
gaps open=20
out of a base and on earnings news. The best way to catch them is to =
know=20
which stocks are basing, are due to announce earnings, then place a =
buy=20
stop-limit, or be ready to take action live on the B/O that morning. =
In=20
general, stocks that gap up on strong volume and earnings news will =
continue=20
that move, so I don't hesitate to take them even if they are =
beyond the=20
5% of pivot rule if the stock has all the right characteristics. (I =
picked up=20
this trick from a '96 IBD article on gaps, later reinforced by Gary =
Kaltbaum's=20
gap strategy)</DIV>
<DIV> </DIV>
<DIV>On WON's 4% losses--at both the IBD seminars I attended, I =
remember=20
comments from WON and his presenters in which they noted that they =
were able=20
to spot whether a breakout was going to work almost immediately. They =
are so=20
good at reading Price/Volume action that they can know whether they =
are wrong=20
about a breakout long before it hits the 8% rule. I've also heard this =
same=20
comment from other CANSLIM-style hedge fund managers such as Greg =
Kuhn, Tim=20
Truebenbach and Kevin Marder. The second thing they do is to set a =
sell rule=20
that will not allow them *any* loss once a stock has successfully =
broken out.=20
So, if the stock breaks out and then retraces on light volume to the =
pivot,=20
fine. But if the breakout succeeds and then begins to fail on high =
volume,=20
they are out long before it retraces and at the very least, out at =
purchase=20
price. I think these are subtleties lost when CANSLIMers automatically =
assume=20
that every purchase should be protected with *exactly* an 8% loss. I =
think the=20
sell rules are more complex than that, but that doesn't mean they =
aren't=20
consistent or repeatable.</DIV>
<DIV> </DIV>
<DIV>Katherine</DIV>
<BLOCKQUOTE=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=3Ddukemill@tampabay.rr.com=20
href=3D"mailto:dukemill@tampabay.rr.com">Duke Miller</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> Friday, March 08, 2002 =
8:42=20
AM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> RE: [CANSLIM] A =
short=20
ride</DIV>
<DIV><BR></DIV>Mike:<BR><BR>If I may, some observations (albeit =
laced with a=20
touch of cynicism, which I<BR>hope is acceptable herein...in =
moderation, of=20
course...).<BR><BR>My recollection is, Mike, is to expect just that =
scenario=20
you've described<BR>below, but ONLY when it CLOSES at the BOTTOM of =
the fall=20
on high volume.<BR>Which poses a question: If it's noon, the =
stock is=20
trading in the bottom of<BR>it's range on high volume, should you =
sell?=20
(Those of you who use stops<BR>don't need to answer that...you're =
out=20
already!) But what if it rebounds an<BR>hour later, and =
subsequently=20
closes down somewhat, but higher than where it<BR>was at noon? =
Did I=20
screw up selling too soon? The answer: See =
tomorrow's<BR>chart,=20
then decide! Then you'd find that what it did (pullback=20
slightly<BR>after breakout) was normal!<BR><BR>"Remember when's" are =
more=20
the rule than the exception these days. A few<BR>recent=20
examples:<BR><BR>How many remember this one (from my notes at a =
seminar ten=20
years ago): "Only<BR>buy a stock after it CLOSES above its breakout =
on 150%=20
or greater volume.<BR>Then buy it at the next day's opening =
price." =20
Hmm. I know the volatile<BR>90's necessitated a change, but =
the=20
shakeouts I've encountered since<BR>January1 have caused me to =
reflect on=20
this old rule.<BR><BR>Then, just the other day, in Investor's =
Corner, "Only=20
buy a stock within 5%<BR>of its pivot point, unless it gaps up at =
the=20
open." So if it gaps up at the<BR>open is it okay to buy it if =
it's up=20
10% mid-day? I think I know the<BR>answer: Only if =
TOMORROW's=20
says you should have.<BR><BR>Then comes this a.m.'s Big Picture: =
"Defense=20
contractors, home builders and<BR>some retailers that defied the =
market's=20
recent correction are too extended<BR>above their prior bases to buy =
without=20
risking a shakeout." I distinctly<BR>remember a recent comment =
therein=20
that these are the stocks to consider,<BR>because they're done so =
well in a=20
down market! You know, high =
Relative<BR>Strength?<BR><BR>Finally, and=20
hopefully this is only bordering on blasphemy: =
Today's<BR>Investors=20
Corner says: "IBD founder William O'Neil says he's right =
only<BR>about=20
half the time. The secret to his success? At an IBD =
advanced=20
seminar<BR>last year, O'Neil said he's kept his losses at an average =
of=20
about 4%. But<BR>when he finds a winner...." Excuse me, =
isn't 4%=20
about half the 8%<BR>"insurance" he recommends? Could this be =
a=20
misprint?<BR><BR>I know this only proves we're all constantly =
developing our=20
own variances on<BR>a theme. It's like I told my wife this=20
morning: "You know, I think I'm<BR>going to get this whole =
process=20
nailed down to perfection the day before I<BR>leave this =
world!" Ain't=20
hindsight a wonderful thing? Now where did I put<BR>tomorrow's =
charts???<BR><BR>Happy hunting...<BR><BR>Duke<BR><BR><BR>> =
- -----Original=20
Message-----<BR>> From: <A=20
=
href=3D"mailto:owner-canslim@lists.xmission.com">owner-canslim@lists.xmis=
sion.com</A><BR>>=20
[mailto:owner-canslim@lists.xmission.com]On Behalf Of Mike =
Lucero<BR>>=20
Sent: Friday, March 08, 2002 5:51 AM<BR>> To: <A=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
<BR>>=20
Subject: Re: [CANSLIM] A short ride<BR>><BR>><BR>> I seem =
to=20
remember an article where they said don't worry if a stock =
falls<BR>>=20
hard back toward it's pivot, even on increasing volume. =
Hmm.<BR>><BR>>=20
Mike<BR>> ----- Original Message -----<BR>> From: "Bill =
Triffet"=20
<<A=20
=
href=3D"mailto:btriffet@earthlink.net">btriffet@earthlink.net</A>><BR>=
>=20
To: <<A=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
><BR>>=20
Sent: Thursday, March 07, 2002 11:47 AM<BR>> Subject: Re: =
[CANSLIM] A=20
short ride<BR>><BR>><BR>> Oops sorry Mike. I meant to get =
back to=20
you. Thankfully Katherine<BR>> stepped up<BR>> to the plate =
with the=20
article.<BR>> Btw, today's action confirms the failed breakout. =
Looked=20
like a<BR>> great stock<BR>> at the time =
though...<BR>><BR>>=20
-Bill<BR>><BR>> ----- Original Message -----<BR>> From: =
"Katherine=20
Malm" <<A=20
=
href=3D"mailto:kmalm@earthlink.net">kmalm@earthlink.net</A>><BR>> =
To:=20
<<A=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
><BR>>=20
Sent: Thursday, March 07, 2002 11:26 AM<BR>> Subject: Re: =
[CANSLIM] A=20
short ride<BR>><BR>><BR>> Hi Mike,<BR>><BR>> I've =
uploaded a=20
copy of the article to:<BR>><BR>> <A=20
=
href=3D"http://WallStreet-LLC.com/pub/BreakoutReversals030602.jpg">http:/=
/WallStreet-LLC.com/pub/BreakoutReversals030602.jpg</A><BR>><BR>>=20
Katherine<BR>> ----- Original Message=20
-----<BR>> From: Mike Lucero<BR>> To: =
<A=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
<BR>> =20
Sent: Wednesday, March 06, 2002 7:09 PM<BR>> Subject: =
Re:=20
[CANSLIM] A short ride<BR>><BR>><BR>> What did =
it=20
say?<BR>> ----- Original Message =
- -----<BR>> =20
From: "Bill Triffet" <<A=20
=
href=3D"mailto:btriffet@earthlink.net">btriffet@earthlink.net</A>><BR>=
> =20
To: <<A=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
><BR>> =20
Sent: Wednesday, March 06, 2002 12:27 PM<BR>> =
Subject: Re:=20
[CANSLIM] A short ride<BR>><BR>><BR>> UOPX sure =
looks=20
like another example of today's Investors<BR>> Corner - =
Beware<BR>>=20
Of<BR>> Reversal On Breakout. A tail with large =
volume. I got=20
out as well.<BR>><BR>> -Bill=20
Triffet<BR>><BR>><BR>> ----- Original Message=20
-----<BR>> From: "Tim Fisher" <<A=20
=
href=3D"mailto:Tim@orerockon.com">Tim@orerockon.com</A>><BR>> =
=20
To: <<A=20
=
href=3D"mailto:canslim@mail.xmission.com">canslim@mail.xmission.com</A>&g=
t;<BR>> =20
Sent: Wednesday, March 06, 2002 9:37 AM<BR>> Subject: =
[CANSLIM] A short ride<BR>><BR>><BR>> > Well =
that=20
was certainly a short ride with UOPX and POSS.<BR>> Makes me=20
wonder<BR>> > whether this is a big cap rally now. =
All=20
after I put in orders for the<BR>> =
open<BR>> =20
> today for NTBK and RBMG (neither of which is following =
suit,<BR>>=20
thankfully).<BR>> > Anyway just really wanted to =
test the=20
server since I don't<BR>> see any email<BR>> > =
from the=20
group today.<BR>><BR>><BR>><BR>> =20
-<BR>> -To subscribe/unsubscribe, email "<A=20
=
href=3D"mailto:majordomo@xmission.com">majordomo@xmission.com</A>"<BR>>=
; =20
-In the email body, write "subscribe canslim" or<BR>> =
-"unsubscribe canslim". Do not use quotes in your=20
email.<BR>><BR>><BR>> -<BR>> -To =
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=
href=3D"mailto:majordomo@xmission.com">majordomo@xmission.com</A>"<BR>>=
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-In the email body, write "subscribe canslim" or<BR>> =
-"unsubscribe canslim". Do not use quotes in your=20
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