Re: [CANSLIM] DFXI again

From: Warren Keuffel <wkeuffel@xmission.com>
Subject: Re: [CANSLIM] DFXI again
Date: Fri, 19 Apr 2002 10:07:30 -0600

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No great words of wisdom here, but a few observations. I pretty much 
ignore intraday activity *unless* it continues a trend I've observed 
from the previous day or two. When that happens I put the stock on my 
mental "death watch" list and if it continues to break down I sell -- I 
find candlestick charting useful for deciding when to exit. Re: early 
day activity. We discussed that a year or so ago and came to the 
conclusion that a lot of that is due to people getting online and 
placing limit orders before going to work. I pretty much ignore what 
happens in the first couple of hours.

Warren

Dave Rubin wrote:

>Bought DFXI on 3/28 breakout. Sold for loss on 4/4. Sat back and watched the
>stock surge higher, now hitting new highs on volume. Kicking myself for
>following CANSLIM rules.
>
>I know WON says this will happen but nevertheless it is discouraging. It's
>happened many times to me already. Each time it makes me want to throw
>CANSLIM out the window.
>
>I'm trying to ignore my emotions and do a constructive post-mortem. Did I
>buy wrong? I don't think so -- it was a nice cup-handle breakout and I
>bought within 5% of the pivot. Did I bail too soon? Maybe. I know you're
>supposed to cut losses at 8% period. But in this case on 4/4 it dropped
>below 8% only intraday, then it surged to recover above the pivot.
>
>In reviewing past similar trades, intraday activity has often been the
>cause. Many times a stock will shake out intraday only to recover before the
>day is done.
>
>So I wonder, should the 8% sell rule be applied on closing prices only? In
>this case, if I waited until the end of trading on 4/4, I'd still be in DFXI
>and enjoying the ride.
>
>Or maybe, should you simply ignore the first hour or two of trading during
>the day? It seems to me in many cases, early trading is very volatile and
>it's probably best to just sit on the sidelines until after lunch.
>
>--
>Dave
>
>
>
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