RE: [CANSLIM] Low Volume Pullback Below Pivot

From: "Katherine Malm" <kmalm@earthlink.net>
Subject: RE: [CANSLIM] Low Volume Pullback Below Pivot
Date: Fri, 18 Jul 2003 11:23:09 -0500

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Hi Dave & John,

Here's how I see BE's chart. In all cases, the basing formation is a
bottoming base, which requires more interpretive action than do bases formed
after long uptrends.

Here is BE 5/23/03. The problem is not with the base itself, but with the
severely laggard RSRank of 35:

http://www.breakoutwatch.com/katherine/BE052303.JPG

Here is BE 6/23/03. It's continued to climb up and now has a non-laggard
RSRank = 75, but it never had a convincing move above the pivot at 10.80
(set 6/16). That is usually an indication that the stock is still building
the RHS of the base, rising and falling and potentially setting a fresh
pivot.

http://www.breakoutwatch.com/katherine/BE062303.JPG

Here is BE as of today. The lack of a convincing move above the previous
pivot set a fresh pivot at 11.04 (set 7/15/03), but the base itself has some
problems, particularly a lack of convincing volume build up on the RHS.

http://www.breakoutwatch.com/katherine/BE071803.JPG

While BE provided entry points closer to its bottom, I don't think it's
provided a comfortable CANSLIM intermediate/term entry point just yet.
Entries on pullbacks would then be a riskier venture, though highly do-able.
If willing to take on the risk, I would look to the general price action
itself to find a pullback entry much closer to the bottom of a logical
support area if entering while the stock's still forming a more convincing
RHS. If the market rolls over, then an entry here makes it easier to
determine if the stock is going to roll over by itself or in response to
generally weak market action.

http://www.breakoutwatch.com/katherine/BEFallZone.JPG

Katherine

- -----Original Message-----
From: owner-canslim@lists.xmission.com
[mailto:owner-canslim@lists.xmission.com]On Behalf Of Davellil5@aol.com
Sent: Friday, July 18, 2003 8:23 AM
To: canslim@lists.xmission.com
Subject: Re: [CANSLIM] Low Volume Pullback Below Pivot


What pivot last Tuesday on BE?

Seems to me that BE broke out late April, early May, without bothering to
form a handle.

There has been no secondary base since then that lasted the 7-8 weeks
suggested by WON as a minimum.

The question of buying a stock post-breakout should interest CANSLIM-ers as
we so often become aware of a stock only after it has broken out and is over
the 5% "chase-limit" suggested by WON.

DAVE

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