RE: [CANSLIM] M - How low will it go.


From: "Hill, Ernie" <Ernie.Hill@ElPaso.com>
Subject: RE: [CANSLIM] M - How low will it go.
Date: Sat, 20 Jul 2002 23:16:47 -0500

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Ira,
 
In my post made on 7-17 I said that the bounce I was expecting had been made
that day and that I expected the S&P to drop to at least 865 by Monday. What
I didn't say was that 845 was my next target. I also posted on 7-13 that I
expected a drop to the 759-782 level by 8-15 or 8-16.
 
Bear with me on some of these numbers while I build my case. I am going to
talk about Fibonacci extensions a little bit. A Fibonacci extension is
measuring a current move by comparing it to recent moves in the same
direction. This is the series of numbers for these extensions .236, .5,
.618, 1.00, 1.236, 1.5, 1.618, & so on.
 
If we measure from the high on 5-17 to the low on 6-14 and multiply the
points by 1.618 and then subtract this number from the high on 6-18 we get
838.74.
 
If we measure from the high on 6-18 to the low on 7-3 and multiply the
points by 1.382 and then subtract this number from the high on 7-8 we get
847.22. We closed Friday at 847.76.
 
If we measure from the high on 6-18 to the low on 7-15 and multiply the
points by .5 and then subtract this number from the high on 7-17 we get
844.44. The low on Friday was 842.14.
 
This is an impressive cluster of Fibonacci extensions all occurring very
near where the market ended up on Friday. This could be strong enough
support to signal a turn in the market from here. Generally this type of
support would provide a spring board from which to move up. However, my
timing model suggests that we will continue to work lower to at least 7-24.
Also the slope of the decline has become much sharper suggesting to me that
we finally saw some fear in this market. I therefore, would not be surprised
to see the market move down sharply again on Monday. I also would not be
surprised to see a one or two day bounce from this level, and then a
continuation of the decline.
 
As far as my forecast of 759-782 by 8-15 or 8-16 I stand by that forecast
with one modification, due to the fear that I see beginning to be manifest
in the market I think this level could be seen by an earlier date
specifically 7-25 or 7-26. And the 780 level looks to be the stronger
candidate. Here is the case for 780.
 
If we measure from the high on 3-19 to the low on 5-7 and multiply the
points by 2.618 and then subtract this number from the high on 5-17 we get
779.79.
 
If we measure from the high on 6-18 to the low on 7-3 and multiply the
points by 1.382 and then subtract this number from the high on 7-17 we get
780.18.
 
And if we measure from the high on 7-8 to the low on 7-15 and multiply the
points by 1.236 and then subtract this number from the high on 7-17 we get
781.91.
 
This is a very tight cluster of Fibonacci extensions and suggests that this
could be the level where we can find an intermediate term bottom. Not THE
bottom, but a bottom that could spark a very strong bear market rally.
 
In conclusion Friday could have been the intermediate term bottom at 842.14,
but my stuff suggests that the odds are in favor of at least one more swift
drop to the 780 level before the intermediate term bottom is in.
 
E
 
 
- -----Original Message-----
From: Ira Post [mailto:ip108@yahoo.com] 
Sent: Saturday, July 20, 2002 4:21 AM
To: canslim@lists.xmission.com
Subject: [CANSLIM] M - How low will it go.
 
I've been sitting out of the market and this discussion list because I don't
think these market conditions are suitable for Canslim.  But I'm ready to
get back into it once the market turns around.
 
My question is how much longer before the market turns and how low will it
get?  I'd like to hear alot of different opinons and people's reasons.  It
may do us all some good.
 
Ira
 

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<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>Ira,<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>In my post made on 7-17 I said that the
bounce I was expecting had been made that day and that I expected the S&amp=
;P
to drop to at least 865 by Monday. What I didn't say was that 845 was my
next target. I also posted on 7-13 that I expected a drop to the 759-782 le=
vel
by 8-15 or 8-16.<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>Bear with me on some of these numbers
while I build my case. I am going to talk about Fibonacci extensions a litt=
le
bit. A Fibonacci extension is measuring a current move by comparing it to
recent moves in the same direction. This is the series of numbers for these
extensions .236, .5, .618, 1.00, 1.236, 1.5, 1.618, &amp; so on.<o:p></o:p>=
</span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>If we measure from the high on 5-17 to=
 the
low on 6-14 and multiply the points by 1.618 and then subtract this number =
from
the high on 6-18 we get </span></font><font size=3D2 color=3Dred face=3DAri=
al><span
style=3D'font-size:10.0pt;font-family:Arial;color:red'>838.74</span></font>=
<font
size=3D2 color=3Dnavy face=3DArial><span style=3D'font-size:10.0pt;font-fam=
ily:Arial;
color:navy'>.<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>If we measure from the high on 6-18 to=
 the
low on 7-3 and multiply the points by 1.382 and then subtract this number f=
rom
the high on 7-8 we get </span></font><font size=3D2 color=3Dred face=3DAria=
l><span
style=3D'font-size:10.0pt;font-family:Arial;color:red'>847.22</span></font>=
<font
size=3D2 color=3Dnavy face=3DArial><span style=3D'font-size:10.0pt;font-fam=
ily:Arial;
color:navy'>. We closed Friday at </span></font><font size=3D2 color=3Dred
face=3DArial><span style=3D'font-size:10.0pt;font-family:Arial;color:red'>8=
47.76</span></font><font
size=3D2 color=3Dnavy face=3DArial><span style=3D'font-size:10.0pt;font-fam=
ily:Arial;
color:navy'>.<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>If we measure from the high on 6-18 to=
 the
low on 7-15 and multiply the points by .5 and then subtract this number from
the high on 7-17 we get </span></font><font size=3D2 color=3Dred face=3DAri=
al><span
style=3D'font-size:10.0pt;font-family:Arial;color:red'>844.44</span></font>=
<font
size=3D2 color=3Dnavy face=3DArial><span style=3D'font-size:10.0pt;font-fam=
ily:Arial;
color:navy'>. The low on Friday was </span></font><font size=3D2 color=3Dred
face=3DArial><span style=3D'font-size:10.0pt;font-family:Arial;color:red'>8=
42.14</span></font><font
size=3D2 color=3Dnavy face=3DArial><span style=3D'font-size:10.0pt;font-fam=
ily:Arial;
color:navy'>.<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>This is an impressive cluster of Fibon=
acci
extensions all occurring very near where the market ended up on Friday. This
could be strong enough support to signal a turn in the market from here.
Generally this type of support would provide a spring board from which to m=
ove
up. However, my timing model suggests that we will continue to work lower t=
o at
least 7-24. Also the slope of the decline has become much sharper suggestin=
g to
me that we finally saw some fear in this market. I therefore, would not be
surprised to see the market move down sharply again on Monday. I also would=
 not
be surprised to see a one or two day bounce from this level, and then a
continuation of the decline.<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>As far as my forecast of 759-782 by 8-=
15
or 8-16 I stand by that forecast with one modification, due to the fear tha=
t I
see beginning to be manifest in the market I think this level could be seen=
 by an
earlier date specifically 7-25 or 7-26. And the </span></font><font size=3D2
color=3Dred face=3DArial><span style=3D'font-size:10.0pt;font-family:Arial;
color:red'>780</span></font><font size=3D2 color=3Dnavy face=3DArial><span
style=3D'font-size:10.0pt;font-family:Arial;color:navy'> level looks to be =
the
stronger candidate. Here is the case for 780.<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>If we measure from the high on 3-19 to=
 the
low on 5-7 and multiply the points by 2.618 and then subtract this number f=
rom
the high on 5-17 we get </span></font><font size=3D2 color=3Dred face=3DAri=
al><span
style=3D'font-size:10.0pt;font-family:Arial;color:red'>779.79</span></font>=
<font
size=3D2 color=3Dnavy face=3DArial><span style=3D'font-size:10.0pt;font-fam=
ily:Arial;
color:navy'>.<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>If we measure from the high on 6-18 to=
 the
low on 7-3 and multiply the points by 1.382 and then subtract this number f=
rom
the high on 7-17 we get </span></font><font size=3D2 color=3Dred face=3DAri=
al><span
style=3D'font-size:10.0pt;font-family:Arial;color:red'>780.18</span></font>=
<font
size=3D2 color=3Dnavy face=3DArial><span style=3D'font-size:10.0pt;font-fam=
ily:Arial;
color:navy'>.<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>And if we measure from the high on 7-8=
 to
the low on 7-15 and multiply the points by 1.236 and then subtract this num=
ber
from the high on 7-17 we get </span></font><font size=3D2 color=3Dred face=
=3DArial><span
style=3D'font-size:10.0pt;font-family:Arial;color:red'>781.91</span></font>=
<font
size=3D2 color=3Dnavy face=3DArial><span style=3D'font-size:10.0pt;font-fam=
ily:Arial;
color:navy'>.<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>This is a very tight cluster of Fibona=
cci
extensions and suggests that this could be the level where we can find an
intermediate term bottom. Not THE bottom, but a bottom that could spark a v=
ery
strong bear market rally.<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>In conclusion Friday could have been t=
he
intermediate term bottom at 842.14, but my stuff suggests that the odds are=
 in
favor of at least one <span class=3DGramE>more swift</span> drop to the 780=
 level
before the intermediate term bottom is in.<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'>E<o:p></o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal><font size=3D2 color=3Dnavy face=3DArial><span style=
=3D'font-size:
10.0pt;font-family:Arial;color:navy'><o:p>&nbsp;</o:p></span></font></p>

<p class=3DMsoNormal style=3D'margin-left:.5in'><font size=3D2 face=3DTahom=
a><span
style=3D'font-size:10.0pt;font-family:Tahoma'>-----Original Message-----<br>
<b><span style=3D'font-weight:bold'>From:</span></b> Ira Post
[mailto:ip108@yahoo.com<span class=3DGramE>] <br>
<b><span style=3D'font-weight:bold'>Sent</span></b></span><b><span
style=3D'font-weight:bold'>:</span></b> </span></font><st1:date Month=3D"7"=
 Day=3D"20"
Year=3D"2002"><font size=3D2 face=3DTahoma><span style=3D'font-size:10.0pt;=
font-family:
 Tahoma'>Saturday, July 20, 2002</span></font></st1:date><font size=3D2
face=3DTahoma><span style=3D'font-size:10.0pt;font-family:Tahoma'> </span><=
/font><st1:time
Hour=3D"4" Minute=3D"21"><font size=3D2 face=3DTahoma><span style=3D'font-s=
ize:10.0pt;
 font-family:Tahoma'>4:21 AM</span></font></st1:time><font size=3D2 face=3D=
Tahoma><span
style=3D'font-size:10.0pt;font-family:Tahoma'><br>
<b><span style=3D'font-weight:bold'>To:</span></b> </span></font><st1:Perso=
nName><font
 size=3D2 face=3DTahoma><span style=3D'font-size:10.0pt;font-family:Tahoma'=
>canslim@lists.xmission.com</span></font></st1:PersonName><font
size=3D2 face=3DTahoma><span style=3D'font-size:10.0pt;font-family:Tahoma'>=
<br>
<b><span style=3D'font-weight:bold'>Subject:</span></b> [CANSLIM] M - How l=
ow
will it <span class=3DGramE>go.</span></span></font><o:p></o:p></p>

<p class=3DMsoNormal style=3D'margin-left:.5in'><font size=3D3 face=3D"Time=
s New Roman"><span
style=3D'font-size:12.0pt'><o:p>&nbsp;</o:p></span></font></p>

<div>

<p class=3DMsoNormal style=3D'margin-left:.5in'><font size=3D2 face=3DArial=
><span
style=3D'font-size:10.0pt;font-family:Arial'>I've been sitting out of the m=
arket
and this discussion list because I don't think these market conditions are
suitable for Canslim.&nbsp; But I'm ready to get back into it once the mark=
et
turns around.</span></font><o:p></o:p></p>

</div>

<div>

<p class=3DMsoNormal style=3D'margin-left:.5in'><font size=3D3 face=3D"Time=
s New Roman"><span
style=3D'font-size:12.0pt'>&nbsp;<o:p></o:p></span></font></p>

</div>

<div>

<p class=3DMsoNormal style=3D'margin-left:.5in'><font size=3D2 face=3DArial=
><span
style=3D'font-size:10.0pt;font-family:Arial'>My question is how much longer
before the market turns and how low will it get?&nbsp; I'd like to hear alo=
t of
different opinons and people's reasons.&nbsp; It may do us all some good.</=
span></font><o:p></o:p></p>

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<p class=3DMsoNormal style=3D'margin-left:.5in'><font size=3D3 face=3D"Time=
s New Roman"><span
style=3D'font-size:12.0pt'>&nbsp;<o:p></o:p></span></font></p>

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<p class=3DMsoNormal style=3D'margin-left:.5in'><font size=3D2 face=3DArial=
><span
style=3D'font-size:10.0pt;font-family:Arial'>Ira</span></font><o:p></o:p></=
p>

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<div>

<p class=3DMsoNormal style=3D'margin-left:.5in'><font size=3D3 face=3D"Time=
s New Roman"><span
style=3D'font-size:12.0pt'>&nbsp;<o:p></o:p></span></font></p>

</div>

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<p class=3DMsoNormal style=3D'margin-left:.5in'><font size=3D2 face=3DArial=
><span
style=3D'font-size:10.0pt;font-family:Arial'><br>
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Outgoing mail is certified Virus Free.<br>
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