RE: [CANSLIM] short selling (WEBX)

From: "Mark Kerson" <mkerson@dplus.net>
Subject: RE: [CANSLIM] short selling (WEBX)
Date: Sat, 9 Aug 2003 14:13:12 -0400
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I don't know. 

It does not seem inappropriate to discuss using CANSLIM to short on this
site. 


In IBD, Thursday, August 7, 2003, on the front page of B1, in Investor's
Corner, the last line of the box under "Advanced Study" says, "Learn to
sell shares short during a market decline (see Feb. 14 Corner)" 

It seems possible (at least logical, I certainly can't claim that I have
done it or know anyone who has) to reverse the principles and choose
shorts. Therefore if someone is interested in exploring it, well, I
don't see why we can't.

At any rate I would like too follow such a discussion. 

Mark 


- -----Original Message-----
From: owner-canslim@lists.xmission.com
[mailto:owner-canslim@lists.xmission.com] On Behalf Of Fanus
Sent: Saturday, August 09, 2003 1:16 PM
To: canslim@lists.xmission.com
Subject: Re: [CANSLIM] short selling (WEBX) 

Rolf

Yes, WON spent about 3 pages on short selling in his
book of about 270 pages. And in these three pages he
showed two chart patterns and doesn't mention any of
the CANSLIM attributes, or reverse of them for
shorting.  HTTMIS mentioned lots of other things also,
but this isn't a group to discuss HTTMIS. It is a
group to discuss CANSLIM.

Just because he mentioned short selling in the book,
doesn't make it CANSLIM. He also mentioned daytrading
and swingtrading in his book. Also not CANSLIM. If you
decide to use reverse CANSLIM criteria to pick shorts
then it is fine.  But this doesn't make it CANSLIM and
is not mentioned by WON at all as shorting criteria. 
Any rules you use for shorting is your rules and not
WON's rules for CANSLIM.

To use the criteria below, where in CANSLIM, or HTTMIS
for that matter, is the "ANI" criteria mentioned as
valid shorting criteria?

If you want to learn more about selling short, why not
find a discussion group which main goal is to discuss
shorting methods and criteria?  I sell short stocks
too and I am not against shorting. I am just against
discussing it out of place.  

Best Regards
- - Fanus

- --- Rolf Hertenstein <rolfh@mindspring.com> wrote:
> ----- Original Message -----
> From: "Fanus" <fanus13@yahoo.com>
> 
> > CANLSIM is a long strategy and according to the
> rules,
> > you get out if you are in a bear market.
> > I think this type of discussions are
> > better suited for a different discussion group.
> 
> I disagree.  Though WON spends almost all of his
> HTMMIS pages on long
> techniques, he does discuss short selling in
> correcting or beginning bear
> markets.  He even gives a couple of chart pattern
> examples, like the Head
> and Shoulders Top.  I would welcome any discussion
> here from the more
> experienced members on their short techniques.  If
> we are (or even if we
> aren't) at the beginning of a multi-year, mostly
> sideways market, with
> occassional bull runs, seems like effective shorting
> could really help
> overall returns.
> 
> Some specific thoughts on DMC's post (see below):
> A (annual earnings): Seems like a change in earnings
> (for the worse) would
> be more important a specific number like 15%.
> N (new something): My two thoughts are 1. a new
> product that *doesn't* live
> up to expectations, or 2. new 52-week low.
> I (institutional): If there are large institutional
> positions, and they
> begin to dumpp the stock, might this not drive the
> price more aggressively
> downward?
> 
>  Rolf
> 
> >
> > --- DMC197807 <dmc197807@comcast.net> wrote:
> > > P.S. [prescript]:  I can't see any reason to
> > > establish (or keep) a long
> > > position on WEBX here.  Too much risk for me.
> > >
> > > Mark,
> > >
> > > Welcome to the thread.  I don't have any problem
> > > with you posting your
> > > website location here; it looked pretty good to
> me.
> > >
> > > On the subject of using canslim to find
> breakdown
> > > rather than breakout
> > > candidates, I think that's a good idea.  I'm not
> > > sure how we properly tweak
> > > the criteria, but I think it's an excellent
> topic
> > > for education here.  Why?
> > > Because the M in Milscan is very, very
> precarious
> > > here and I think shorts
> > > and puts are going to smash longs and calls over
> the
> > > next several weeks.  I
> > > don't see a lot more upside to the market at
> this
> > > point.  Just pulling up an
> > > SPX chart shows a very very tired market, and
> the
> > > path of least resistance
> > > looks to be southeast-, and not northeastward
> bound.
> > >
> > > With that in mind, how would be alter CANSLIM to
> > > look for breakdowns?  [I'll
> > > put commentary in brackets for breakdown]
> > >
> > > C = Current quarterly earnings per share (should
> > > show a major percentage
> > > increase compared to the prior year's same
> quarter)
> > > [Here I think you take
> > > all earnings up to, say 10% positive.  Why? 
> What we
> > > are looking for are
> > > stocks which have risen with the tide in spite
> of
> > > lukewarm or poor earnings,
> > > but earnings up to 30% seem too robust to
> produce a
> > > good short.]
> > >
> > > A = Annual earnings (the company should be
> > > experiencing meaningful growth
> > > over the past five years) [Perhaps the cap on
> annual
> > > earnings growth should
> > > be 15%??]
> > >
> > > N = New products, new management, new high
> prices [I
> > > don't see how to apply
> > > this one; I don't want to exclude new high
> prices,
> > > because we're looking for
> > > overvalued stocks.  Other ideas?]
> > >
> > > S = Supply and demand (small capitalization
> stocks
> > > with high trading volume)
> > > [Here, having large cap elephants could be a
> great
> > > idea
> > >
> > > L = Leader in the industry, not a laggard [here,
> use
> > > a relative strength
> > > rating of 60 or below?]
> > >
> > > I = Institutional sponsorship (a little goes a
> long
> > > way) [Hmmmm.  Do we want
> > > high institutional ownership, or is this factor
> one
> > > to be left out
> > >
> > > M = Market direction (should be headed up). 
> [This
> > > one goes first.  For me,
> > > the market is facing a lot more easy downside
> right
> > > here than upside.
> > > Chances of a SPX in the 600, 700, 800 range in
> the
> > > next 3-4 months is much
> > > greater, to me, than a SPX move to 1100, 1200,
> > > 1300.]
> > >
> > > Now comes the difficulty of establishing a
> pivot,
> > > and selling at the
> > > breakdown of that point.
> > >
> > >
> > >
> > > DMC
> > >
> > >
> > >
> > >
> > >
> > > ----- Original Message -----
> > > From: "Mark Crisp"
> > > <stressfreetrader@btopenworld.com>
> > > To: <canslim@lists.xmission.com>
> > > Sent: Wednesday, August 06, 2003 8:17 AM
> > > Subject: Re: [CANSLIM] WEBX
> > >
> > >
> > > > What about using CANSLIM in reverse to find
> > > shorting candidates?
> > > >
> > > >  I ran this scan on my filter and came up with
> > > some nice looking shorting
> > > > candidates:
> > > >
> > > > 1 year low
> > > > RS <30
> > > > E.P.S. <30
> > > > Price >$30
> > > > Volume >250,000
> > > > Cap. >2.0bn
> > > >
> > > >   Looking for poor fundamental stocks that are
> > > falling in price. Reverese
> > > > CANSLIM if you like. Trade the breakouts.
> > > >
> > > >   What do you say?
> > > >
> > > >   Mark Crisp
> > > >  http://www.stressfreetrading.com
> > > >
> > > > ----- Original Message -----
> > > > From: "Jiehui" <ddloyilbshrb@iartdesign.com>
> > > > To: <canslim@lists.xmission.com>
> > > > Sent: Wednesday, August 06, 2003 5:42 AM
> > > > Subject: [CANSLIM] WEBX
> > > >
> > > >
> > > > > Hi all,
> > > > >
> > > > > I'm a beginner in this and is still a little
> > > unsure of how to read
> > > charts.
> > > > I hope some of the more experienced chart
> readers
> > > on this group can help
> > > me.
> 
=== message truncated ===


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