Re: [CANSLIM] Right side of cup variations...

From: "Bill Triffet" <btriffet@earthlink.net>
Subject: Re: [CANSLIM] Right side of cup variations...
Date: Tue, 17 Jun 2003 21:06:41 -0700

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Hi Katherine,

I thought symmetry was important as well.  My thoughts as well were that the
sellers would not be shaken out through the base due to the quick rebound on
the right side...i.e.: recouped the losses from the left side.

I mainly bring it up as there are many new folks to canslim and charting
that get focused on the cup/handle thing without understanding why the shape
is important.

- --
Bill

- ----- Original Message -----
From: "Katherine Malm" <kmalm@earthlink.net>
To: <canslim@lists.xmission.com>
Sent: Tuesday, June 17, 2003 6:18 PM
Subject: RE: [CANSLIM] Right side of cup variations...


> Hi Bill,
>
> For FNIS specifically, the big gap up is due to a proposed buyout offer.
I'd
> say that this is not really typical basing action. Unless you're already
in
> a stock when the deal is announced, I'd say avoid these altogether, as
> arbitrage controls the price at that point.
>
> In other cases, big gaps on the right of the base do occur, but part of
what
> makes a base "a good base" is some degree of symmetry. For example, if a
> stock falls to the lows of its consolidation over a period of 5 months and
> then suddenly jumps up the right side of the base in a few sessions, then
it
> lacks that symmetry and becomes more prone to shake outs that would
> otherwise have occurred as it built the right side of the base over time.
>
> Katherine
>
>
> -----Original Message-----
> From: owner-canslim@lists.xmission.com
> [mailto:owner-canslim@lists.xmission.com]On Behalf Of Bill Triffet
> Sent: Tuesday, June 17, 2003 12:50 PM
> To: canslim
> Subject: [CANSLIM] Right side of cup variations...
>
>
> I have noticed on some occasions there are bases where the right side of
the
> cup is completed by perhaps only one or two gap ups. An example might be
> FNIS. Notice the gapup on 5/27 that forms most of the right side.
> Note: I'm only refering to its right side cup as an example and not the
> upwards handle or fundies which are suspect for me...
>
> Now, assumming the handle and volume are behaving...would the gapups on
the
> right side be a red/yellow flag for a "solid" base?
>
> --
> Bill
>
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