Re: [CANSLIM] cup-without-handle; "tightness" questions

From: "Tom Worley" <stkguru@bellsouth.net>
Subject: Re: [CANSLIM] cup-without-handle; "tightness" questions
Date: Tue, 13 Aug 2002 10:53:45 -0400

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on the downside, often suggests the point where institutional support
exists, but only on the larger more liquid stocks.

- ----- Original Message -----
From: <Spencer48@aol.com>
To: <canslim@lists.xmission.com>
Sent: Tuesday, August 13, 2002 10:50 AM
Subject: Re: [CANSLIM] cup-without-handle; "tightness" questions


Katherine:

     Couldn't "churning" also identify a stock which has been weak (ie. in a
downtrend), but then does not make any more headway down-and does this on
heavy volume.  Wouldn't this indicate the end of the downtrend (or at
least-the beginning of a consolidation, perhaps leading to the stock
garnering strength?).

     Moreover, as distribution (as you pointed out) is likely at the top (as
indicated by the hi volume and stalling); wouldn't accumulation be likely at
the churning point in the downtrend (ie. since the stock is not falling
anymore and it is not doing it on hi volume-wouln't this signify that
someone is buying up all the stock that someone else is selling)

     I bring up this question because I'm not sure of the answer.  I thought
WON has said (or perhaps it was in an IBD Investors Corner article) that
"churning" can take place on the upside (to indicate future weakness) or on
the downside (to indicate future strength).

     In any event, what is your experience or observation or comments and
conclusions on my churning conundrum.


                           jans


In a message dated Wed, 7 Aug 2002 11:33:26 AM Eastern Standard Time,
kmalm@earthlink.net writes:

> Long story short, churning/stalling is in reference to action *after* a
> stock or index has been rising, nears its highs, then starts acting odd.
> That is, large volume is no longer accompanied by significant upward price
> movement. In that sense, it is subtle distribution and is a
> sign that the
> stock may be topping and/or beginning a consolidating period



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