Go to Jeff Salisbury LWGate Home Page.From: "Gene Ricci" <genr@swbell.net>
Subject: Re: [CANSLIM] HITK--Volume Studies
Date: Wed, 6 Aug 2003 11:35:03 -0500
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This is a multi-part message in MIME format. - ------=_NextPart_000_0507_01C35C0E.C74B3C40 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable DMC, how about you point us to a chart that passes your criteria? Gene ----- Original Message -----=20 From: DMC197807=20 To: canslim@lists.xmission.com=20 Sent: Wednesday, August 06, 2003 10:10 AM Subject: Re: [CANSLIM] HITK--Volume Studies One problem with threads and email lists is the topics tend to lack follow-through. The newest hot topic or stock du jour takes over the airspace and previous topics disappear. Perhaps they should, but I = think the HITK education is out there for people who want to take the time = to understand why this stock which gapped and crapped was an unlikely = delight at $25, $26 or "under $25". One problem with getting your list of = MILSCANs and IBD 100 stocks is you tend to love them long after their = usefulness has evaporated (or long before they become useful again). First off, if you can part with some pi$tole$, may I suggest buying = Donald Cassidy's Trading with Volume. As you can see from the reviews, some = people think it's great, some think it doesn't tell you anything new. I = think for $25 and a few hours of dedicated reading it's pretty good insurance = against buying an exhaustion gap or jumping in to buy HITK as it's crumbling. = If it saves you one bad trade (guaranteed to save you more, but . . .) = then it's worth about 10 times the purchase price. It's generally not available = in libraries: = http://www.amazon.com/exec/obidos/tg/detail/-/0071376046/qid=3D1060182177= /sr=3D1 = - -1/ref=3Dsr_1_1/102-9779625-0378563?v=3Dglance&s=3Dbooks#product-details Those who trade on price alone are like people who fly airplanes on visibility alone. Or maybe trying to trade on price action alone is = like trying to speak a foreign language with nothing but tons of = vocabulary--no grammar, no semantic rules, no idioms, just a lot of words. If you've = ever encountered a newly arrived foreign student in the hard sciences you = get the drift. Volume is a key and crucial instrument. It's really too bad = we can trade volume as well as price (that is, buy options on volume levels, = rather than just price levels), but there's probably no efficient way to do = it. Otoh, using volume to understand price is key. Another useful thing is just to scroll down this note, starting at the bottom and noting the dates. If you have a dual screen setup, you = might put the daily or 60 minute chart of HITK up against it, and try to see = what was going on at what point in the conversation. HITK is continuing its short, squat candlestick march on low volume, = down below $23 as I type. How long will the bleeding last? Who knows, but = at this angle and with this momentum (volume) it can be excruciating. = How will it end? Impossible to say, but a likely scenario will be the = wholesale dumping of shares if $20 doesn't hold. I don't see it holding. I = think it could collapse tomorrow or the next day, then we might have an "echo" = of the plunge from $40 to $25, with a little boost up to 28 (and all the = bullish chatter) before it finds its proper bottom. Check now the widening of = the Bollinger bands on the bottom side, giving this thing plenty of space = to run. So, let's take another look around 8/15 to see if it has fallen = through 20 to 15 and bounced. Looking out longer term, on the weekly chart, you = can see some support at $10 and what looks like rock bottom fisher/vulture carcass at around $7-8. So, short term support at $20, $15; medium = term support at $10 and an "event" or crushingly bad market could take us = to $7. DMC ----- Original Message ----- From: "DMC197807" <dmc197807@comcast.net> To: <canslim@lists.xmission.com> Sent: Monday, August 04, 2003 8:56 AM Subject: Re: [CANSLIM] HITK > Perhaps members of the group will find it educational to follow HITK = for a > little while longer. Nobody has a crystal ball on these things, but > experience has taught me the hard way that not paying attention to = price > action and volume can be costly. > > As I opined earlier, this chart pattern is a very familiar, broken = stock > picture. Volume keeps fading away as buyers back away from this = name and > holders are just beginning to get the picture that the bleeding has = only > begun, and hasn't begun to stop yet. We've now crossed up above the = 200 dma > very weakly and fallen back down through it. I'd expect this stock = to stay > below the 200 dma for a significant amount of time from now on, long = after > all the averages complete their southerly curves. Since there are = few > buyers it won't take many sellers to show up, dump their shares and = get out. > That accounts for the small but steady march south. The Bollinger = Bands > have now widened significantly; when a stock is rallying it can = climb along > the upper band for a long time; the same happens on the bottom band = when > it's falling. The bottom band is pointed directly toward $15 right = now; I > see no reason why, given enough time this summer, it won't achieve = and then > overshoot that number. If HITK had options, I'd be buying puts = here. If I > was an HITK owner, I'd get out at any price right now. > > DMC > > ----- Original Message ----- > From: "DMC197807" <dmc197807@comcast.net> > To: <canslim@lists.xmission.com> > Sent: Monday, July 28, 2003 11:05 AM > Subject: Re: [CANSLIM] HITK > > > > Fanus, > > > > Thanks for your note. Each of us has his own system. Back in May = I > traded > > HITK off the center of the Bollinger bands for a bounce which I = got and I > > was monitoring it off shorter time frame charts. The mistake I = made was > not > > holding on for the ride further up, but I was leaving for 10 days = on the > > East Coast and couldn't afford to keep the position open, so I = left with > > 9.3% gain in 7 days. If I can annualize that gain it's better = than 300% > per > > year, so I like it. I kept a tight stop on the position so maybe = your > > calculation of the risk wasn't mine. > > > > Everyone looks at risk and reward differently. You may see a = stock which > > can rise up to 35 or 40 fairly easily (the reward) but I see a = broken > chart > > and the likelihood of that happening as very, very slim. More = likely, > given > > the pattern, is for the stock to pause and hiccup and continue to = break > > down. Or it could stabilize and idle here at the $22-28 range for = a > while. > > However, there have been a lot of buyers on the way up to $49 and = not all > of > > them have sold. It often takes several days for the totality of a = drop > from > > 49 to 25 to sink in. A lot of people hope it will recover, a lot = try to > > trade out, but in the end the weight of the chart often produces = the > > inevitable. > > > > Another way to look at your calculation is to try to figure out = the > > probabilities within a given time frame (let's take 2 weeks, or 10 trading > > days) of your two speculation scenarios to play out: 1) drops to = 23? > this > > is highly likely, imho, given the ATR where it is, call it 2-1; or = 2) > rises > > to 35 or 40? this is a 40-1 shot, to me, in this time period, or = worse. > So > > you calculate the value of the two and, with the stock where it is = now, > > 26.50, you have a 50% chance of losing $3.50, or -1.75, and a 2.5% chance > of > > it rising to 35, or $0.87, so I wouldn't take your approach, not = even with > > your money. > > > > What is the better approach? Patience, let the plunge work = through its > > natural progression. > > > > This is what makes a market, though. Regards, > > > > DMC > > > > > > > > ----- Original Message ----- > > From: "Fanus" <fanus13@yahoo.com> > > To: <canslim@lists.xmission.com> > > Sent: Monday, July 28, 2003 10:19 AM > > Subject: Re: [CANSLIM] HITK > > > > > > > I haven't look at the CANSLIM characteristics, but > > > risk/reward look pretty good to me. > > > > > > If one trade it as a bounce off the 200DMA, then your > > > stop can be just below it. Say around 23.00. You > > > could have entered around 25.30 this morning, risking > > > 2.30. If I was trading it, I would expect it to > > > possibly stall at resistance around 35 to 40 which > > > would be my profit target. A profit target of about > > > 9.7 to 14.7. Risking 2.3 to get 9.7 is a risk/reward > > > ratio of 1/4.2. Risking 1 dollar to make 4.2. Good > > > enough for me. > > > > > > You mentioned that you bought HITK at 5/30/03 at > > > 34.20. From my side, I do not see significant support > > > close by, or a logical place to put a stop loss other > > > than the 50DMA which were at 30.74 on that date. A > > > risk of 3.46. You sold on 6/5 at 37.47; a profit of > > > 3.27. So you risk 3.46 to make 3.27, a risk/reward > > > ratio of 1/0.95. Risking 1 dollar to make 0.95. > > > > > > In my books, an entry now is much less risky than your > > > entry on 5/30. > > > > > > Regards > > > - Fanus > > > > > > > > > --- DMC197807 <dmc197807@comcast.net> wrote: > > > > MessageGene, > > > > > > > > I understood that. However, I think it's > > > > hard/dangerous to trade consistently (and safely) > > > > from signals generated by newsletters and stock > > > > pickers, or black boxes or discussion threads. I > > > > assume you are out of HITK at this point? > > > > > > > > My comments were and are limited to trying to grasp > > > > the total risk-reward on the name as indicated by > > > > the chart. Still too risky for me, maybe not for > > > > others. When the charts come into alignment, then > > > > money is made more easily, although not without > > > > risk. > > > > > > > > I took $3+ out of HITK at the end of May by > > > > following my discipline (bot 5/30 at 34.20, sold 6/5 > > > > at 37.47), and it was this experience which caught > > > > my attention with your post. > > > > > > > > HITK may close this week higher or lower, and at > > > > that point it may still not be a good speculation, > > > > for my money. > > > > > > > > Good luck, > > > > > > > > DMC > > > > > > > > > > > > ----- Original Message ----- > > > > From: Gene Ricci > > > > To: canslim@lists.xmission.com > > > > Sent: Monday, July 28, 2003 9:32 AM > > > > Subject: Re: [CANSLIM] HITK > > > > > > > > > > > > DMC, if you'll go back to my original email you'll > > > > see that I was making an observation ... and passing > > > > it on to potential holders of HITK .... based on a > > > > buy signal from ChangeWave. > > > > > > > > 'If you still own HITK there may be a light in the > > > > tunnel.' > > > > > > > > In the meantime I made 75 cents/share trading it > > > > this morning (going long)... after the opening > > > > pullback... > > > > > > > > Gene > > > > > > > > > > > > > > > > > > > > > > > > > > > > ----- Original Message ----- > > > > From: DMC197807 > > > > To: canslim@lists.xmission.com > > > > Sent: Monday, July 28, 2003 11:01 AM > > > > Subject: Re: [CANSLIM] HITK > > > > > > > > > > > > Gene, > > > > > > > > Two thoughts come to mind. First is a ski area > > > > I frequent. Just below the highest lift are some > > > > cliffs which are out of bounds by regulation and > > > > also by dint of pure reason: they look like > > > > suicide. However, on any thick powder day there are > > > > a number of youth with their snowboards and skis > > > > doing the "extreme thing." For some reason only 2 > > > > people have gotten killed there in my memory, and a > > > > few bad accidents, but mostly these yahoos make it > > > > through. It doesn't mean it isn't an absurd risk to > > > > take, but there you are. > > > > > > > > Is HITK still a falling knife, or is it safe to > > > > buy? > > > > > > > > Second is: what is volume during normal trading > > > > and what is volume during a selloff? Clearly HITK > > > > is in a selloff, so I like to look at something like > > > > 10 day volume (or volume since the plunge) rather > > > > than 60-day volume. Here the 60-day volume is > > > > 583,000, but the most recent 8 days have coughed up > > > > about 10 million shares, or 1.25 million per day. I > > > > was looking at HITK early today and was surprised > > > > that the first hour, amateur hour, didn't produce > > > > more volume. It's now 2.5 hours into the trading > > > > day and it's still at 330,000 shares. > > > > > > > > I think today is simply a pause on the way down. > > > > I have no money in this name now and only look at > > > > it to determine when, on a trading basis, the reward > > > > might outweigh the risk. That event might not > > > > happen for several weeks and might take place at a > > > > higher price than today's (in fact, could easily do > > > > so). > > > > > > > > Mostly I think of this endeavor as the opposite > > > > of even recreational skiing. We want to find the > > > > easiest, most risk free way of having fun (making > > > > $$), not the adrenaline rushed version. If this > > > > were a ski slope, my scans would be scouting for not > > > > black diamond slopes or blue slopes. Unlike skiing, > > > > here I'm on the hunt for easy green slopes and even > > > > yellow bunny hop slopes. > > > > > > > > Good luck, > > > > > > > > DMC > > > > ----- Original Message ----- > > > > From: Gene Ricci > > > > To: canslim@lists.xmission.com > > > > Sent: Monday, July 28, 2003 7:35 AM > > > > Subject: Re: [CANSLIM] HITK > > > > > > > > > > > > The power of the newsletter assumes control... > > > > up 6% and 1/3 of the daily volume already. > > > > > > > > Gene > > > > ----- Original Message ----- > > > > From: DMC197807 > > > > To: canslim@lists.xmission.com > > > > Sent: Saturday, July 26, 2003 10:35 PM > > > > Subject: Re: [CANSLIM] HITK > > > > > > > > > > > > Technically your risk/reward on this name > > > > would be skewed toward risk at this point. The > > > > chart shows no stopping yet, volume is still high > > > > and the daily patterns are bearish. The price > > > > dropped right through the 200 day EMA (25.85), is > > > > below any support on the daily (there looks like > > > > some support at $20 on the weekly). If $20 holds, > > > > who's interested in buying for a quick off the bat > > > > 20% loss? > > > > > > > > I don't actually see why $20 should hold for > > > > more than a pause, anyway. To me there's no sense > > > > in looking for "bad news," it's all in the chart > > > > right now. > > > > > > > > JMHO, > > > > > > > > DMC > > > > > > > > > > > > > > > > ----- Original Message ----- > > > > From: Gene Ricci > > > > To: canslim@lists.xmission.com > > > > Sent: Saturday, July 26, 2003 6:30 PM > > > > Subject: [CANSLIM] HITK > > > > > > > > > > > > If you still own HITK there may be a light > > > > in the tunnel. Change Wave (Tobin Smith) sent an > > > > alert to his 300,000 (?) subscribers to buy HITK on > > > > 7/25. Looking at the chart shows that the price > > > > dropped down and stabilized at its 200-day moving > > > > average at $23.14 before bouncing higher. It closed > > > > at $24.88 on 7/25. Other than a possible shortfall > > > > because of seasonal cough medicine sales I couldn't > > > > find any other bad news. Anyone know of any other > > > > issues? > > > > > > > > Thanks, > > > > Gene > > > > > > > > I was forwarded the following; > > > > > > > > A price under $25 is a great entry point > > > > for this dual > > > > generic/diabetes play -- forget the noise > > > > from the momentum > > > > buyers-turned-sellers. They were cleaned > > > > out with the huge volume > > > > sales, so now it's time to build or add to > > > > your positions to get to > > > > a $25 cost basis. I still think we can > > > > hold on for a $50 value at > > > > the end of 2004 on $2 per share earnings > > > > in 2004. > > > > > > > > Let's lower the buy under for HITK to $25. > > > > > > > > > > > > > > > > > > > > > __________________________________ > > > Do you Yahoo!? > > > Yahoo! SiteBuilder - Free, easy-to-use web site design software > > > http://sitebuilder.yahoo.com > > > > > > - > > > -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. > > > - > -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. - ------=_NextPart_000_0507_01C35C0E.C74B3C40 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable <!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN"> <HTML><HEAD> <META http-equiv=3DContent-Type content=3D"text/html; = charset=3Diso-8859-1"> <META content=3D"MSHTML 6.00.2800.1106" name=3DGENERATOR> <STYLE></STYLE> </HEAD> <BODY bgColor=3D#ffffff> <DIV><FONT face=3D"Comic Sans MS">DMC, how about you point us to = a chart that=20 passes your criteria?</FONT></DIV> <DIV><FONT face=3D"Comic Sans MS"></FONT> </DIV> <DIV><FONT face=3D"Comic Sans MS">Gene</FONT></DIV> <DIV><FONT face=3D"Comic Sans MS"></FONT> </DIV> <DIV><FONT face=3D"Comic Sans MS"></FONT> </DIV> <BLOCKQUOTE=20 style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; = BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px"> <DIV style=3D"FONT: 10pt arial">----- Original Message ----- </DIV> <DIV=20 style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: = black"><B>From:</B>=20 <A title=3Ddmc197807@comcast.net=20 href=3D"mailto:dmc197807@comcast.net">DMC197807</A> </DIV> <DIV style=3D"FONT: 10pt arial"><B>To:</B> <A = title=3Dcanslim@lists.xmission.com=20 = href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>= </DIV> <DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Wednesday, August 06, = 2003 10:10=20 AM</DIV> <DIV style=3D"FONT: 10pt arial"><B>Subject:</B> Re: [CANSLIM] = HITK--Volume=20 Studies</DIV> <DIV><BR></DIV>One problem with threads and email lists is the topics = tend to=20 lack<BR>follow-through. The newest hot topic or stock du jour = takes over=20 the<BR>airspace and previous topics disappear. Perhaps they = should, but=20 I think<BR>the HITK education is out there for people who want to take = the=20 time to<BR>understand why this stock which gapped and crapped was an = unlikely=20 delight<BR>at $25, $26 or "under $25". One problem with getting = your=20 list of MILSCANs<BR>and IBD 100 stocks is you tend to love them long = after=20 their usefulness has<BR>evaporated (or long before they become useful=20 again).<BR><BR>First off, if you can part with some pi$tole$, may I = suggest=20 buying Donald<BR>Cassidy's Trading with Volume. As you can see = from the=20 reviews, some people<BR>think it's great, some think it doesn't tell = you=20 anything new. I think for<BR>$25 and a few hours of = dedicated=20 reading it's pretty good insurance against<BR>buying an exhaustion gap = or=20 jumping in to buy HITK as it's crumbling. If it<BR>saves you one = bad=20 trade (guaranteed to save you more, but . . .) then = it's<BR>worth=20 about 10 times the purchase price. It's generally not available=20 in<BR>libraries:<BR><BR><A=20 = href=3D"http://www.amazon.com/exec/obidos/tg/detail/-/0071376046/qid=3D10= 60182177/sr=3D1">http://www.amazon.com/exec/obidos/tg/detail/-/0071376046= /qid=3D1060182177/sr=3D1</A><BR>-1/ref=3Dsr_1_1/102-9779625-0378563?v=3Dg= lance&s=3Dbooks#product-details<BR><BR>Those=20 who trade on price alone are like people who fly airplanes = on<BR>visibility=20 alone. Or maybe trying to trade on price action alone is = like<BR>trying=20 to speak a foreign language with nothing but tons of=20 vocabulary--no<BR>grammar, no semantic rules, no idioms, just a lot of = words. If you've ever<BR>encountered a newly arrived foreign = student in=20 the hard sciences you get the<BR>drift. Volume is a key and = crucial=20 instrument. It's really too bad we can<BR>trade volume as well = as price=20 (that is, buy options on volume levels, rather<BR>than just price = levels), but=20 there's probably no efficient way to do it.<BR>Otoh, using volume to=20 understand price is key.<BR><BR>Another useful thing is just to scroll = down=20 this note, starting at the<BR>bottom and noting the dates. If = you have a=20 dual screen setup, you might put<BR>the daily or 60 minute chart of = HITK up=20 against it, and try to see what was<BR>going on at what point in the=20 conversation.<BR><BR>HITK is continuing its short, squat candlestick = march on=20 low volume, down<BR>below $23 as I type. How long will the = bleeding=20 last? Who knows, but at<BR>this angle and with this momentum = (volume) it=20 can be excruciating. How will<BR>it end? Impossible to = say, but a=20 likely scenario will be the wholesale<BR>dumping of shares if $20 = doesn't=20 hold. I don't see it holding. I think it<BR>could collapse = tomorrow or the next day, then we might have an "echo" of = the<BR>plunge from=20 $40 to $25, with a little boost up to 28 (and all the = bullish<BR>chatter)=20 before it finds its proper bottom. Check now the widening of=20 the<BR>Bollinger bands on the bottom side, giving this thing plenty of = space=20 to<BR>run.<BR><BR>So, let's take another look around 8/15 to see if it = has=20 fallen through 20<BR>to 15 and bounced. Looking out longer term, = on the=20 weekly chart, you can<BR>see some support at $10 and what looks like = rock=20 bottom fisher/vulture<BR>carcass at around $7-8. So, short term = support=20 at $20, $15; medium term<BR>support at $10 and an "event" or = crushingly bad=20 market could take us to $7.<BR><BR>DMC<BR><BR>----- Original Message=20 -----<BR>From: "DMC197807" <<A=20 = href=3D"mailto:dmc197807@comcast.net">dmc197807@comcast.net</A>><BR>To= :=20 <<A=20 = href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>= ><BR>Sent:=20 Monday, August 04, 2003 8:56 AM<BR>Subject: Re: [CANSLIM] = HITK<BR><BR><BR>>=20 Perhaps members of the group will find it educational to follow HITK = for=20 a<BR>> little while longer. Nobody has a crystal ball on = these=20 things, but<BR>> experience has taught me the hard way that not = paying=20 attention to price<BR>> action and volume can be = costly.<BR>><BR>> As=20 I opined earlier, this chart pattern is a very familiar, broken = stock<BR>>=20 picture. Volume keeps fading away as buyers back away from this = name=20 and<BR>> holders are just beginning to get the picture that the = bleeding=20 has only<BR>> begun, and hasn't begun to stop yet. We've now = crossed=20 up above the 200<BR>dma<BR>> very weakly and fallen back down = through=20 it. I'd expect this stock to<BR>stay<BR>> below the 200 dma = for a=20 significant amount of time from now on, long after<BR>> all the = averages=20 complete their southerly curves. Since there are few<BR>> = buyers it=20 won't take many sellers to show up, dump their shares and = get<BR>out.<BR>>=20 That accounts for the small but steady march south. The = Bollinger=20 Bands<BR>> have now widened significantly; when a stock is rallying = it can=20 climb<BR>along<BR>> the upper band for a long time; the same = happens on the=20 bottom band when<BR>> it's falling. The bottom band is = pointed=20 directly toward $15 right now; I<BR>> see no reason why, given = enough time=20 this summer, it won't achieve and<BR>then<BR>> overshoot that = number. =20 If HITK had options, I'd be buying puts here. If<BR>I<BR>> = was an=20 HITK owner, I'd get out at any price right now.<BR>><BR>>=20 DMC<BR>><BR>> ----- Original Message -----<BR>> From: = "DMC197807"=20 <<A=20 = href=3D"mailto:dmc197807@comcast.net">dmc197807@comcast.net</A>><BR>&g= t; To:=20 <<A=20 = href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>= ><BR>>=20 Sent: Monday, July 28, 2003 11:05 AM<BR>> Subject: Re: [CANSLIM]=20 HITK<BR>><BR>><BR>> > Fanus,<BR>> ><BR>> > = Thanks for=20 your note. Each of us has his own system. Back in May = I<BR>>=20 traded<BR>> > HITK off the center of the Bollinger bands for a = bounce=20 which I got and<BR>I<BR>> > was monitoring it off shorter time = frame=20 charts. The mistake I made was<BR>> not<BR>> > holding = on for=20 the ride further up, but I was leaving for 10 days on the<BR>> > = East=20 Coast and couldn't afford to keep the position open, so I left = with<BR>>=20 > 9.3% gain in 7 days. If I can annualize that gain it's = better than=20 300%<BR>> per<BR>> > year, so I like it. I kept a tight = stop on=20 the position so maybe your<BR>> > calculation of the risk wasn't = mine.<BR>> ><BR>> > Everyone looks at risk and reward=20 differently. You may see a stock<BR>which<BR>> > can rise = up to 35=20 or 40 fairly easily (the reward) but I see a broken<BR>> = chart<BR>> >=20 and the likelihood of that happening as very, very slim. More=20 likely,<BR>> given<BR>> > the pattern, is for the stock to = pause and=20 hiccup and continue to break<BR>> > down. Or it could = stabilize=20 and idle here at the $22-28 range for a<BR>> while.<BR>> > = However,=20 there have been a lot of buyers on the way up to $49 and = not<BR>all<BR>>=20 of<BR>> > them have sold. It often takes several days for = the=20 totality of a drop<BR>> from<BR>> > 49 to 25 to sink = in. A lot=20 of people hope it will recover, a lot try to<BR>> > trade out, = but in=20 the end the weight of the chart often produces the<BR>> >=20 inevitable.<BR>> ><BR>> > Another way to look at your = calculation=20 is to try to figure out the<BR>> > probabilities within a given = time=20 frame (let's take 2 weeks, or 10<BR>trading<BR>> > days) of your = two=20 speculation scenarios to play out: 1) drops to 23?<BR>> = this<BR>>=20 > is highly likely, imho, given the ATR where it is, call it 2-1; = or=20 2)<BR>> rises<BR>> > to 35 or 40? this is a 40-1 shot, = to me,=20 in this time period, or worse.<BR>> So<BR>> > you calculate = the value=20 of the two and, with the stock where it is now,<BR>> > 26.50, = you have a=20 50% chance of losing $3.50, or -1.75, and a 2.5%<BR>chance<BR>> = of<BR>>=20 > it rising to 35, or $0.87, so I wouldn't take your approach, not=20 even<BR>with<BR>> > your money.<BR>> ><BR>> > What = is the=20 better approach? Patience, let the plunge work through = its<BR>> >=20 natural progression.<BR>> ><BR>> > This is what makes a = market,=20 though. Regards,<BR>> ><BR>> > DMC<BR>> = ><BR>>=20 ><BR>> ><BR>> > ----- Original Message -----<BR>> = > From:=20 "Fanus" <<A=20 href=3D"mailto:fanus13@yahoo.com">fanus13@yahoo.com</A>><BR>> = > To:=20 <<A=20 = href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>= ><BR>>=20 > Sent: Monday, July 28, 2003 10:19 AM<BR>> > Subject: Re: = [CANSLIM]=20 HITK<BR>> ><BR>> ><BR>> > > I haven't look at the = CANSLIM=20 characteristics, but<BR>> > > risk/reward look pretty good to = me.<BR>> > ><BR>> > > If one trade it as a bounce = off the=20 200DMA, then your<BR>> > > stop can be just below it. = Say=20 around 23.00. You<BR>> > > could have entered around = 25.30 this=20 morning, risking<BR>> > > 2.30. If I was trading it, I = would=20 expect it to<BR>> > > possibly stall at resistance around 35 = to 40=20 which<BR>> > > would be my profit target. A profit = target of=20 about<BR>> > > 9.7 to 14.7. Risking 2.3 to get 9.7 is a = risk/reward<BR>> > > ratio of 1/4.2. Risking 1 = dollar to=20 make 4.2. Good<BR>> > > enough for me.<BR>> > = ><BR>> >=20 > You mentioned that you bought HITK at 5/30/03 at<BR>> > = > 34.20.=20 From my side, I do not see significant support<BR>> > > = close=20 by, or a logical place to put a stop loss other<BR>> > > than = the=20 50DMA which were at 30.74 on that date. A<BR>> > > risk = of=20 3.46. You sold on 6/5 at 37.47; a profit of<BR>> > > = 3.27. So=20 you risk 3.46 to make 3.27, a risk/reward<BR>> > > ratio of=20 1/0.95. Risking 1 dollar to make 0.95.<BR>> > ><BR>> = >=20 > In my books, an entry now is much less risky than your<BR>> = > >=20 entry on 5/30.<BR>> > ><BR>> > > Regards<BR>> = > > -=20 Fanus<BR>> > ><BR>> > ><BR>> > > --- = DMC197807=20 <<A = href=3D"mailto:dmc197807@comcast.net">dmc197807@comcast.net</A>>=20 wrote:<BR>> > > > MessageGene,<BR>> > > = ><BR>> >=20 > > I understood that. However, I think it's<BR>> > = >=20 > hard/dangerous to trade consistently (and safely)<BR>> > = > >=20 from signals generated by newsletters and stock<BR>> > > > = pickers, or black boxes or discussion threads. I<BR>> > = > >=20 assume you are out of HITK at this point?<BR>> > > = ><BR>> >=20 > > My comments were and are limited to trying to grasp<BR>> = >=20 > > the total risk-reward on the name as indicated by<BR>> = > >=20 > the chart. Still too risky for me, maybe not for<BR>> = > >=20 > others. When the charts come into alignment, then<BR>> = > >=20 > money is made more easily, although not without<BR>> > > = >=20 risk.<BR>> > > ><BR>> > > > I took $3+ out of = HITK at=20 the end of May by<BR>> > > > following my discipline (bot = 5/30 at=20 34.20, sold 6/5<BR>> > > > at 37.47), and it was this = experience=20 which caught<BR>> > > > my attention with your = post.<BR>> >=20 > ><BR>> > > > HITK may close this week higher or = lower, and=20 at<BR>> > > > that point it may still not be a good=20 speculation,<BR>> > > > for my money.<BR>> > >=20 ><BR>> > > > Good luck,<BR>> > > ><BR>> = >=20 > > DMC<BR>> > > ><BR>> > > ><BR>> = > >=20 > ----- Original Message -----<BR>> > >=20 > From: Gene Ricci<BR>> > > > = To: <A=20 = href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>= <BR>>=20 > > > Sent: Monday, July 28, 2003 9:32 AM<BR>> = >=20 > > Subject: Re: [CANSLIM] HITK<BR>> > >=20 ><BR>> > > ><BR>> > > > DMC, if = you'll=20 go back to my original email you'll<BR>> > > > see that I = was=20 making an observation ... and passing<BR>> > > > it on to=20 potential holders of HITK .... based on a<BR>> > > > buy = signal=20 from ChangeWave.<BR>> > > ><BR>> > > = > 'If=20 you still own HITK there may be a light in the<BR>> > > >=20 tunnel.'<BR>> > > ><BR>> > > > In = the=20 meantime I made 75 cents/share trading it<BR>> > > > this = morning=20 (going long)... after the opening<BR>> > > > = pullback...<BR>>=20 > > ><BR>> > > > Gene<BR>> > = >=20 ><BR>> > > ><BR>> > > ><BR>> > >=20 ><BR>> > > ><BR>> > > ><BR>> > >=20 > ----- Original Message -----<BR>> > >=20 > From: DMC197807<BR>> > >=20 > To: <A=20 = href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>= <BR>>=20 > > > Sent: Monday, July 28, 2003 = 11:01=20 AM<BR>> > > > Subject: Re: = [CANSLIM]=20 HITK<BR>> > > ><BR>> > > ><BR>> > >=20 > Gene,<BR>> > > ><BR>> > = >=20 > Two thoughts come to mind. First is = a ski=20 area<BR>> > > > I frequent. Just below the highest = lift are=20 some<BR>> > > > cliffs which are out of bounds by = regulation=20 and<BR>> > > > also by dint of pure reason: they = look=20 like<BR>> > > > suicide. However, on any thick = powder day=20 there are<BR>> > > > a number of youth with their = snowboards and=20 skis<BR>> > > > doing the "extreme thing." For some = reason=20 only 2<BR>> > > > people have gotten killed there in my = memory,=20 and a<BR>> > > > few bad accidents, but mostly these = yahoos make=20 it<BR>> > > > through. It doesn't mean it isn't an = absurd=20 risk to<BR>> > > > take, but there you are.<BR>> > = >=20 ><BR>> > > > Is HITK still a = falling=20 knife, or is it safe to<BR>> > > > buy?<BR>> > >=20 ><BR>> > > > Second is: what is = volume=20 during normal trading<BR>> > > > and what is volume during = a=20 selloff? Clearly HITK<BR>> > > > is in a selloff, so = I like=20 to look at something like<BR>> > > > 10 day volume (or = volume=20 since the plunge) rather<BR>> > > > than 60-day=20 volume. Here the 60-day volume is<BR>> > > > = 583,000,=20 but the most recent 8 days have coughed up<BR>> > > > = about 10=20 million shares, or 1.25 million per day. I<BR>> > > = > was=20 looking at HITK early today and was surprised<BR>> > > > = that the=20 first hour, amateur hour, didn't produce<BR>> > > > more=20 volume. It's now 2.5 hours into the trading<BR>> > > = > day=20 and it's still at 330,000 shares.<BR>> > > ><BR>> > = >=20 > I think today is simply a pause on the = way=20 down.<BR>> > > > I have no money in this name now = and only=20 look at<BR>> > > > it to determine when, on a trading = basis, the=20 reward<BR>> > > > might outweigh the risk. That = event might=20 not<BR>> > > > happen for several weeks and might take = place at=20 a<BR>> > > > higher price than today's (in fact, could = easily=20 do<BR>> > > > so).<BR>> > > ><BR>> > = >=20 > Mostly I think of this endeavor as the=20 opposite<BR>> > > > of even recreational skiing. We = want to=20 find the<BR>> > > > easiest, most risk free way of having = fun=20 (making<BR>> > > > $$), not the adrenaline rushed = version. =20 If this<BR>> > > > were a ski slope, my scans would be = scouting=20 for not<BR>> > > > black diamond slopes or blue = slopes. =20 Unlike skiing,<BR>> > > > here I'm on the hunt for easy = green=20 slopes and even<BR>> > > > yellow bunny hop = slopes.<BR>> >=20 > ><BR>> > > > Good = luck,<BR>>=20 > > ><BR>> > > > = DMC<BR>> >=20 > > ----- Original Message=20 -----<BR>> > > > From: = Gene=20 Ricci<BR>> > > > To: = <A=20 = href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>= <BR>>=20 > > > Sent: Monday, July = 28, 2003=20 7:35 AM<BR>> > > > = Subject:=20 Re: [CANSLIM] HITK<BR>> > > ><BR>> > > = ><BR>> >=20 > > The power of the = newsletter=20 assumes control...<BR>> > > > up 6% and 1/3 of the daily = volume=20 already.<BR>> > > ><BR>> > >=20 > Gene<BR>> > >=20 > ----- Original = Message=20 -----<BR>> > > = > =20 From: DMC197807<BR>> > >=20 > To: <A=20 = href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>= <BR>>=20 > > > Sent: = Saturday,=20 July 26, 2003 10:35 PM<BR>> > >=20 > Subject: Re: = [CANSLIM]=20 HITK<BR>> > > ><BR>> > > ><BR>> > >=20 > Technically your=20 risk/reward on this name<BR>> > > > would be skewed toward = risk at=20 this point. The<BR>> > > > chart shows no stopping = yet,=20 volume is still high<BR>> > > > and the daily patterns are = bearish. The price<BR>> > > > dropped right through = the 200=20 day EMA (25.85), is<BR>> > > > below any support on the = daily=20 (there looks like<BR>> > > > some support at $20 on the=20 weekly). If $20 holds,<BR>> > > > who's interested = in buying=20 for a quick off the bat<BR>> > > > 20% loss?<BR>> > = >=20 ><BR>> > > = > I=20 don't actually see why $20 should hold for<BR>> > > > more = than a=20 pause, anyway. To me there's no sense<BR>> > > > in = looking=20 for "bad news," it's all in the chart<BR>> > > > right=20 now.<BR>> > > ><BR>> > >=20 > JMHO,<BR>> = > >=20 ><BR>> > > = > =20 DMC<BR>> > > ><BR>> > > ><BR>> > >=20 ><BR>> > >=20 > ----- = Original Message -----<BR>> > >=20 > From: = Gene=20 Ricci<BR>> > >=20 > To: = <A=20 = href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>= <BR>>=20 > > = > =20 Sent: Saturday, July 26, 2003 6:30 PM<BR>> > >=20 > = Subject:=20 [CANSLIM] HITK<BR>> > > ><BR>> > > ><BR>> = > >=20 > If = you still=20 own HITK there may be a light<BR>> > > > in the tunnel. = Change=20 Wave (Tobin Smith) sent an<BR>> > > > alert to his 300,000 = (?)=20 subscribers to buy HITK on<BR>> > > > 7/25. Looking at the = chart=20 shows that the price<BR>> > > > dropped down and = stabilized at its=20 200-day moving<BR>> > > > average at $23.14 before = bouncing=20 higher. It closed<BR>> > > > at $24.88 on 7/25. Other than = a=20 possible shortfall<BR>> > > > because of seasonal cough = medicine=20 sales I couldn't<BR>> > > > find any other bad news. = Anyone know=20 of any other<BR>> > > > issues?<BR>> > > = ><BR>>=20 > > = > =20 Thanks,<BR>> > >=20 > = Gene<BR>>=20 > > ><BR>> > >=20 > I was = forwarded the following;<BR>> > > ><BR>> > >=20 > A = price under=20 $25 is a great entry point<BR>> > > > for this = dual<BR>> >=20 > > =20 generic/diabetes play -- forget the noise<BR>> > > > from = the=20 momentum<BR>> > >=20 > =20 buyers-turned-sellers. They were cleaned<BR>> > > > out = with the=20 huge volume<BR>> > >=20 > = sales, so now=20 it's time to build or add to<BR>> > > > your positions to = get=20 to<BR>> > >=20 > a $25 = cost=20 basis. I still think we can<BR>> > > > hold on for a $50 = value=20 at<BR>> > >=20 > the = end of=20 2004 on $2 per share earnings<BR>> > > > in 2004.<BR>> = >=20 > ><BR>> > >=20 > Let's = lower=20 the buy under for HITK to $25.<BR>> > > ><BR>> > = >=20 ><BR>> > > ><BR>> > ><BR>> > = ><BR>> >=20 > __________________________________<BR>> > > Do you=20 Yahoo!?<BR>> > > Yahoo! SiteBuilder - Free, easy-to-use web = site=20 design software<BR>> > > <A=20 = href=3D"http://sitebuilder.yahoo.com">http://sitebuilder.yahoo.com</A><BR= >>=20 > ><BR>> > > -<BR>> > > -To = subscribe/unsubscribe,=20 email "<A=20 = href=3D"mailto:majordomo@xmission.com">majordomo@xmission.com</A>"<BR>>= ; >=20 > -In the email body, write "subscribe canslim" or<BR>> > = >=20 -"unsubscribe canslim". Do not use quotes in your email.<BR>> = ><BR>> ><BR>> > -<BR>> > -To = subscribe/unsubscribe, email=20 "<A = href=3D"mailto:majordomo@xmission.com">majordomo@xmission.com</A>"<BR>>= ;=20 > -In the email body, write "subscribe canslim" or<BR>> >=20 -"unsubscribe canslim". Do not use quotes in your=20 email.<BR>><BR>><BR>> -<BR>> -To subscribe/unsubscribe, = email "<A=20 = href=3D"mailto:majordomo@xmission.com">majordomo@xmission.com</A>"<BR>>= ; -In=20 the email body, write "subscribe canslim" or<BR>> -"unsubscribe=20 canslim". Do not use quotes in your email.<BR><BR><BR>-<BR>-To=20 subscribe/unsubscribe, email "<A=20 = href=3D"mailto:majordomo@xmission.com">majordomo@xmission.com</A>"<BR>-In= the=20 email body, write "subscribe canslim" or<BR>-"unsubscribe = canslim". 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