[CANSLIM] Reading Charts

From: Gene Ricci <genr@swbell.net>
Subject: [CANSLIM] Reading Charts
Date: Fri, 15 Nov 2002 14:13:29 -0600
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Interesting and I support his guidance..... the highlighting is mine.
Gene



TSC Technical Forum
What to Watch for When Reading Charts
By Gary B. Smith
Special to RealMoney.com

Head and shoulders. Cup and handle. Bullish flag. Bearish pennant. Yes, =
all of those patterns are important things to look for in chart-reading. =
They're also pretty meaningless.=20


Just remember one thing when you look at charts: All you really need to =
watch out for are support, resistance and trend lines. Add on volume and =
price action, and pretty soon you have 99% of what you need to be an =
"expert" chart reader.=20

A good example is what I show below in charts like the Nasdaq and =
General Electric (GE:NYSE - news - commentary) . Yes, there are some =
patterns there, but even if those aren't the correct patterns, it really =
doesn't matter, as the true signals are defined by the things I =
mentioned above.=20

So, is the Nasdaq really forming a "cup and handle"? I guess, but who =
cares? The true test of that pattern is if it can close above 1420. If =
it does, then I'm bullish on that index regardless of what it's called. 
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<DIV><FONT face=3D"Comic Sans MS">Interesting and I support his =
guidance..... the=20
highlighting is mine.</FONT></DIV>
<DIV><FONT face=3D"Comic Sans MS">Gene</FONT></DIV>
<DIV><FONT face=3D"Comic Sans MS"></FONT>&nbsp;</DIV>
<DIV><FONT face=3D"Comic Sans MS"></FONT><BR></DIV>
<DIV><FONT face=3D"Comic Sans MS">
<P><FONT face=3D"arial, helvetica" color=3D#000000 size=3D1><I>TSC</I> =
Technical=20
Forum</FONT><BR><FONT face=3D"arial, helvetica" color=3D#000000 =
size=3D4><B>What to=20
Watch for When Reading Charts</B><BR></FONT><FONT face=3D"arial, =
helvetica"=20
color=3D#000000 size=3D3><B>By <A =
href=3D"mailto:gsmith@thestreet.com">Gary B.=20
Smith</A><BR>Special to RealMoney.com</B></FONT><BR><BR>Head and =
shoulders. Cup=20
and handle. Bullish flag. Bearish pennant. Yes, all of those patterns =
are=20
important things to look for in chart-reading. They're also pretty =
meaningless.=20
<P></P>Just remember one thing when you look at charts: <STRONG><FONT=20
color=3D#0000ff>All you really need to watch out for are support, =
resistance and=20
trend lines. Add on volume and price action, and pretty soon you have =
99% of=20
what you need</FONT></STRONG> to be an "expert" chart reader.=20
<P></P>A good example is what I show below in charts like the =
<B>Nasdaq</B> and=20
<B>General Electric</B> (GE:NYSE - news - commentary) . Yes, there are =
some=20
patterns there, but even if those aren't the correct patterns, it really =
doesn't=20
matter, as the true signals are defined by the things I mentioned above. =

<P></P>So, is the Nasdaq really forming a "cup and handle"? I guess, but =
who=20
cares? The true test of that pattern is if it can close above 1420. If =
it does,=20
then I'm bullish on that index regardless of what it's called.=20
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