Go to Jeff Salisbury LWGate Home Page.From: "Katherine Malm" <kmalm@earthlink.net>
Subject: RE: [CANSLIM] Sidewall Breakouts
Date: Fri, 27 Jun 2003 09:34:16 -0500
Previous Article (by Subject): Re: [CANSLIM] Opportunity Cost Chazmoore@aol.com
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Hi Dave, I was intrigued with your comment, so took a bit of time scanning stocks in my spreadsheet. As there are so many stocks in great technical condition, I had to narrow it a bit to get a sampling, so focused on strong stocks that were new IPO's in the last 8 years. What I observed was that nearly all of these stocks had formed sound bases, but formed handles very, very close to the midpoint of the cup before they bolted. I think what that really enforces is the notion that one really has to be on top of basing stocks *as* they're basing, particuarly at the very beginning of a fresh rally, as hesitation there will leave you in the dust. One of the sensibilities I picked up from years of using VectorVest is that you really have to be ready to play the direction change in a market. I think that's especially true for CANSLIMers, as our chosen spots are so well-defined. It wouldn't surprise me at all to see all of these strong stocks pull back and form fresh bases right here. That would actually be a good thing for overall market health. Katherine - -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com]On Behalf Of Davellil5@aol.com Sent: Thursday, June 26, 2003 10:47 AM To: canslim@lists.xmission.com Subject: [CANSLIM] Sidewall Breakouts In this market, I've been noticing a large number of stocks that have experienced one or more high-volume breakouts, some of them upgaps, along the right sidewalls of cups. In most instances, there were no handles prior to the breakouts. None of those stocks would have been bought on those occasions under the WON system. Yet, they seem like lost opportunities for gain. On reflection, it doesn't seem far-fetched to reason that, in a period of recovery from a bear market, investors are less likely to wait for full develpment of bases, but take positions at earlier stages in the recovery of individual stocks. Moreover, isn't it likely that several breakouts along the right wall of a cup increase the likelihood that a "real" WON breakout (after completion of cup and handle) on such a stock will be followed by a correction or even collapse, with the investor who buys on the WON breakout getting whipsawed? Does this explain some of the post-cup corrections, of which we've seen so many? Anyone else observed this phenomenon? Regards,k Dave - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email.
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