Go to Jeff Salisbury LWGate Home Page.From: "Tom Worley" <stkguru@bellsouth.net>
Subject: Re: [CANSLIM] M where now?
Date: Mon, 29 Apr 2002 23:29:58 -0400
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Ernie, I do not think you are either an idiot, or arrogant, just have a =
system that you understand, and has been working for you. One of the =
dangers in attempting to predict the market place is that it is not =
always predictable. The longer term you forecast, I think the better =
chance you have for being right more often than wrong. But you are going =
to be wrong some of the time, no matter what.
I remember my enthusiasm when I finally started using some TA (Technical =
Analysis), and started getting familiar with MACD (Moving Average =
Convergence Divergence). I found, for me, it really improved my timing =
of buy and sell points, as well as aiding my decisions on whether to =
hold on or not. But took more time than I then or now had, so =
unfortunately don't use it often enough to be consistent.=20
I think there are tools we can use to help us, including some that try =
to predict the future. But I personally think we should only use them to =
aid our understanding of "M", and let the market tell us what it =
actually is doing now, rather than betting on what it will do then.
Tom Worley
stkguru@bellsouth.net
AIM: TexWorley
- ----- Original Message -----=20
From: Hill, Ernie=20
To: 'canslim@lists.xmission.com'=20
Sent: Monday, April 29, 2002 11:16 PM
Subject: [CANSLIM] M where now?
Hi Group,
=20
When I made my first market forecast to the group back in March part of =
the reason I chose to make a forecast then was because I had a very =
reliable forecast to make. Because of the high probability that I saw =
occurring in the market I chose to make a very precise forecast for =
maximum effect. At that time I said the market would bottom in the 1070 =
to 1075 range on the S&P on 4-17-02. I had a high degree of confidence =
that the market would turn within two days of that date and very close =
to my projected price range.
=20
First the market gave me a head fake with a false turn confirmation, now =
it has blown up my forecast with today's price action. First the S&P has =
set a new low for the move, which will now put the eventual turning =
point outside the maximum range predicted by my model. In addition to =
that it has surpassed the lowest price level that I had projected for =
the move.
=20
So what does it all mean? For some of you it proves that I am an idiot =
that got his just due for being arrogant enough to think that he could =
predict the market. I can accept that criticism; however, from my point =
of view my missed forecast gives hints to the longer term picture for =
the rest of the year. For those of you who are still reading here is =
what I see as the most likely scenario going forward and the =
implications of the market dropping through and past my projected =
turning point.
=20
First of all the S&P will likely drop to an even lower support level =
before the turn is eventually made. This support level will continue to =
drop slightly with each passing day. For tomorrow that level will be =
1035.5, if the S&P drops to that level by tomorrow then the market will =
likely turn from there. Going back to the market low on 9-21-01 the S&P =
put in a low of 944.75 it then rose to a high of 1176.97 on 1-7-02. =
61.8% of that move would be 143.51 points. 61.8% is a key Fibonacci =
ratio where corrections often find support. Subtracting 143.51 points =
from the market high of 1176.97 yields a price level of 1033.46. On May =
2, 2002 my projected support level for the S&P is 1033.5. Will 5-2-02 be =
the day this market actually changes trend at least briefly? We'll see.
=20
The longer term implications are that the ensuing rally will likely be =
briefer than previously expected and certainly have a lower price =
target, maybe even below 1176.97 the current high for the year. If the =
rally that follows this current decline fails to exceed the current high =
for the year then we may be looking at a retest of the September lows =
later in the year.
=20
E
=20
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This email and any files transmitted with it from the ElPaso=20
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<DIV><FONT face=3DArial>Ernie, I do not think you are either an idiot, =
or=20
arrogant, just have a system that you understand, and has been working =
for you.=20
One of the dangers in attempting to predict the market place is that it =
is not=20
always predictable. The longer term you forecast, I think the better =
chance you=20
have for being right more often than wrong. But you are going to be =
wrong some=20
of the time, no matter what.</FONT></DIV>
<DIV><FONT face=3DArial></FONT> </DIV>
<DIV><FONT face=3DArial>I remember my enthusiasm when I finally started =
using some=20
TA (Technical Analysis), and started getting familiar with MACD (Moving =
Average=20
Convergence Divergence). I found, for me, it really improved my timing =
of buy=20
and sell points, as well as aiding my decisions on whether to hold on or =
not.=20
But took more time than I then or now had, so unfortunately don't use it =
often=20
enough to be consistent. </FONT></DIV>
<DIV><FONT face=3DArial></FONT> </DIV>
<DIV><FONT face=3DArial>I think there are tools we can use to help us, =
including=20
some that try to predict the future. But I personally think we should =
only use=20
them to aid our understanding of "M", and let the market tell us what it =
actually is doing now, rather than betting on what it will do =
then.</FONT></DIV>
<DIV><FONT face=3DArial></FONT> </DIV>
<DIV>Tom Worley<BR><A=20
href=3D"mailto:stkguru@bellsouth.net">stkguru@bellsouth.net</A><BR>AIM:=20
TexWorley</DIV>
<DIV style=3D"FONT: 10pt arial">----- Original Message -----=20
<DIV style=3D"BACKGROUND: #e4e4e4; font-color: black"><B>From:</B> <A=20
title=3DErnie.Hill@ElPaso.com =
href=3D"mailto:Ernie.Hill@ElPaso.com">Hill, Ernie</A>=20
</DIV>
<DIV><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><B>Sent:</B> Monday, April 29, 2002 11:16 PM</DIV>
<DIV><B>Subject:</B> [CANSLIM] M where now?</DIV></DIV>
<DIV><BR></DIV>
<DIV class=3DSection1>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt">Hi Group,<o:p></o:p></SPAN></FONT></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt"><o:p> </o:p></SPAN></FONT></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt">When I made my first market forecast to the =
group back=20
in March part of the reason I chose to make a forecast then was because =
I had a=20
very reliable forecast to make. Because of the high probability that I =
saw=20
occurring in the market I chose to make a very precise forecast for =
maximum=20
effect. At that time I said the market would bottom in the 1070 to 1075 =
range on=20
the S&P on </SPAN></FONT><st1:date Year=3D"2002" Day=3D"17"=20
Month=3D"4">4-17-02</st1:date>. I had a high degree of confidence that =
the market=20
would turn within two days of that date and very close to my projected =
price=20
range.<o:p></o:p></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt"><o:p> </o:p></SPAN></FONT></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt">First the market gave me a head fake with a =
false turn=20
confirmation, now it has blown up my forecast with today's price action. =
First=20
the S&P has set a new low for the move, which will now put the =
eventual=20
turning point outside the maximum range predicted by my model. In =
addition to=20
that it has surpassed the lowest price level that I had projected for =
the=20
move.<o:p></o:p></SPAN></FONT></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt"><o:p> </o:p></SPAN></FONT></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt">So what does it all mean? For some of you it =
proves that=20
I am an idiot that got his just due for being arrogant enough to think =
that he=20
could predict the market. I can accept that criticism; however, from my =
point of=20
view my missed forecast gives hints to the longer term picture for the =
rest of=20
the year. For those of you who are still reading here is what I see as =
the most=20
likely scenario going forward and the implications of the market =
dropping=20
through and past my projected turning =
point.<o:p></o:p></SPAN></FONT></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt"><o:p> </o:p></SPAN></FONT></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt">First of all the S&P will likely drop to =
an even=20
lower support level before the turn is eventually made. This support =
level will=20
continue to drop slightly with each passing day. For tomorrow that level =
will be=20
1035.5, if the S&P drops to that level by tomorrow then the market =
will=20
likely turn from there. Going back to the market low on =
</SPAN></FONT><st1:date=20
Year=3D"2001" Day=3D"21" Month=3D"9">9-21-01</st1:date> the S&P put =
in a low of=20
944.75 it then rose to a high of 1176.97 on <st1:date Year=3D"2002" =
Day=3D"7"=20
Month=3D"1">1-7-02</st1:date>. 61.8% of that move would be 143.51 =
points. 61.8% is=20
a key Fibonacci ratio where corrections often find support. Subtracting =
143.51=20
points from the market high of 1176.97 yields a price level of 1033.46. =
On=20
<st1:date Year=3D"2002" Day=3D"2" Month=3D"5">May 2, 2002</st1:date> my =
projected=20
support level for the S&P is 1033.5. Will <st1:date Year=3D"2002" =
Day=3D"2"=20
Month=3D"5">5-2-02</st1:date> be the day this market actually changes =
trend at=20
least briefly? We'll see.<o:p></o:p></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt"><o:p> </o:p></SPAN></FONT></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt">The longer term implications are that the =
ensuing rally=20
will likely be briefer than previously expected and certainly have a =
lower price=20
target, maybe even below 1176.97 the current high for the year. If the =
rally=20
that follows this current decline fails to exceed the current high for =
the year=20
then we may be looking at a retest of the September lows later in the=20
year.<o:p></o:p></SPAN></FONT></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt"><o:p> </o:p></SPAN></FONT></P>
<P class=3DMsoNormal><FONT face=3D"Times New Roman" size=3D3><SPAN=20
style=3D"FONT-SIZE: 12pt">E<o:p></o:p></SPAN></FONT></P>
<P class=3DMsoNormal><FONT face=3DArial size=3D2><SPAN=20
style=3D"FONT-SIZE: 10pt; FONT-FAMILY: =
Arial"><o:p> </o:p></SPAN></FONT></P></DIV><CODE><FONT=20
size=3D3><BR><BR>********************************************************=
**********<BR>This=20
email and any files transmitted with it from the ElPaso <BR>Corporation =
are=20
confidential and intended solely for the <BR>use of the individual or =
entity to=20
whom they are addressed. <BR>If you have received this email in error =
please=20
notify the=20
<BR>sender.<BR>**********************************************************=
********<BR></FONT></CODE></BODY></HTML>
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