Go to Jeff Salisbury LWGate Home Page.From: "DMC197807" <dmc197807@comcast.net>
Subject: Re: [CANSLIM] for Short Selling
Date: Sun, 10 Aug 2003 16:00:10 -0700
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Mighty quiet out there.
Further on the M! Thang, for those who are interested. Here is the Naz =
100 bullish percentage index:
http://stockcharts.com/def/servlet/SC.web?c=3D$BPNDX,uu[h,a]dbclniay[de][=
pc13!c20!f][vc60][i]&pref=3DG
Most recently it was higher than it's been in relevant history (here, =
you can see it in the weekly):
http://stockcharts.com/def/servlet/SC.web?c=3D$BPNDX,uu[h,a]wbclniay[df][=
pc13!c20!f][vc60][i]&pref=3DG
Its recent rating of 91 is just astounding
Here's the Dow:
http://stockcharts.com/def/servlet/SC.web?c=3D$bpINDU,uu[h,a]dbclniay[df]=
[pc13!c20!f][vc60][i]&pref=3DG
And the BP for the SPX:
http://stockcharts.com/def/servlet/SC.web?c=3D$BPspx,uu[h,a]dbclniay[df][=
pc13!c20!f][vc60][i]&pref=3DG
We are definitely picking up a unform pattern of highs not seen before =
(translation: everything is as bullish as possible, meaning there's =
just one way to go. if you can't get more bullish, it's the top).
While you have the SPX chart open, just look at the 3 previous spikes of =
77 (April 2002), 59.80 (Aug 2002) and 68.40 (Dec. 2002), and look back =
to what the SPX did after those moments:
http://stockcharts.com/def/servlet/SC.web?c=3D$SPX,uu[h,a]dbclniay[df][pc=
13!c20!f][vc60][i]&pref=3DG
77 (April 2002)--SPX went from 1150 to 775 in 5 months.
59.80 (Aug 2002)--SPX went from 965 to 768 in 1.5 months
68.40 (Dec. 2002)--SPX went from 950 to 800 in 3 months.
Anyway, it's all very interesting to look at, isn't it? Elliot Wavers =
might see this overly bullish scenario as the setup for yet another =
3-count wave down. I don't really subscribe to EW stuff, but, like =
FIbonacci and Gann, it's useful to at least think about. The last EW =
pattern, if you believe this stuff, took the SPX down from 1500 to 768, =
or a 50% retrace. This one, starting at 1015.40, could do some similar =
damage and take us down to 565-775 over a 12 month period. Some bearish =
reports I've see predict a SPX fall to the mid 600s before year end.
Otoh, we're in the 3rd political year, and 3 and 4 are notoriously good. =
And, if you do a big Fibo study on the SPX since its base in 1995 at =
about 440, we've already done a 38% retrace (back to the 62% line).
http://stockcharts.com/def/servlet/SC.web?c=3D$spx,uu[h,a]mbclniay[pc13!c=
20!f][vc60][i][J15983278,Y]&pref=3DG
All things to think about on a nice, calm, summer Sunday's evening.
DMC
----- Original Message -----=20
From: WJH=20
To: canslim@lists.xmission.com=20
Sent: Sunday, August 10, 2003 10:00 AM
Subject: Fw: [CANSLIM] for Short Selling
Sounds interesting.
From: DMC197807=20
To: canslim@lists.xmission.com=20
Sent: Saturday, August 09, 2003 6:41 PM
Subject: Re: [CANSLIM] for Short Selling
Rolf & Mark,
My vote (if I get a vote) is why not discuss how to use canslim =
ideas to
generate potential shorts? It's not like this little epistolary =
group
hasn't gone off the track since I've been here (about 10 trading =
days), and
it's not like it takes a lifetime to figure out Canslim in any =
event. It's
really rather simple, and with the help of computers it's almost too =
easy.
The real difficulty lies in disciplining oneself to limit or get rid =
of
longs in sideways and topping markets, and be willing to reenter =
when the
market's correction has ended and stocks are ready to rise again. =
You can
find the names of candidates very easily for a little coin paid for =
a
subscription to IBD and/or a subscription to canslim.net.
For short discussions, let's just use the above referenced subject =
line
"Re: [CANSLIM] for Short Selling"
and the purists like Fanus et al (so far it seems to be all Fanus) =
can
either eyeball them and delete them, or even program their Outlook =
Express
to pre-delete all messages on the peripheral topic.
I think it would be helpful to understand what kind of screen would =
generate
the opposite of good longs in a bad market, if only for academic,
mind-sharpening purposes. After all, if in traditional canslim =
technique
you are looking for 1 or 2 stocks to buy per week in a good (M!) =
market,
then why not reverse the order in a bad (M!) market.
With that in mind, I'd like to explore what kinds of things people =
think
would indicate a dangerous market, knowing in advance that calling a =
top is
one of the hardest things to do BUT that falls tend to be so much =
more
precipitous than climbs that there's gold in those hills if you can =
time it
right and buy a put to get into position.
In any event, VTO has provided a very handy site with lots of =
sentiment
indicators:
http://www.vtoreport.com/sentiment/cot.htm
If you click on Sentiment and Bull/Bear you can see a very wide gap =
between
bullish and bearish advisors, the kind which indicates a correction =
is
coming. I'd say anytime you see a gap of 25% or more (with the =
bulls on
top) you are looking at a dangerous situation.
The Put/Call ratio has been very low and is now climbing. Again =
danger.
The VIX has been unnaturally low for a long time, another coiled =
spring.
For COTS, I prefer to use the Quasimodos.com site:
http://www.quasimodos.com/marketrider/technical.php
The articles are interesting, and to get the reports and COTs page, =
click
here:
http://www.quasimodos.com/marketrider/charts.php
You can't paste the sites, but the first 3 on the right, for the =
Dow, the
Naz and the SPX have a very interesting graphic display of the =
traders'
positions. I don't know exactly what the timing is on these but the =
smart
money seems to be betting against this market continuing, while the =
small
speculators keep piling on the positions. Good bull markets (like =
the one
we had from March to June) often begin with very small bars.
DMC
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<BODY bgColor=3D#ffffff>
<DIV><FONT face=3DArial size=3D2>Mighty quiet out there.</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>Further on the M! Thang, for those who =
are=20
interested. Here is the Naz 100 bullish percentage =
index:</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2><A=20
href=3D"http://stockcharts.com/def/servlet/SC.web?c=3D$BPNDX,uu[h,a]dbcln=
iay[de][pc13!c20!f][vc60][i]&pref=3DG">http://stockcharts.com/def/ser=
vlet/SC.web?c=3D$BPNDX,uu[h,a]dbclniay[de][pc13!c20!f][vc60][i]&pref=3D=
G</A></FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>Most recently it was higher than it's =
been in=20
relevant history (here, you can see it in the weekly):</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2><A=20
href=3D"http://stockcharts.com/def/servlet/SC.web?c=3D$BPNDX,uu[h,a]wbcln=
iay[df][pc13!c20!f][vc60][i]&pref=3DG">http://stockcharts.com/def/ser=
vlet/SC.web?c=3D$BPNDX,uu[h,a]wbclniay[df][pc13!c20!f][vc60][i]&pref=3D=
G</A></FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>Its recent rating of 91 is just=20
astounding</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>Here's the Dow:</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2><A=20
href=3D"http://stockcharts.com/def/servlet/SC.web?c=3D$bpINDU,uu[h,a]dbcl=
niay[df][pc13!c20!f][vc60][i]&pref=3DG">http://stockcharts.com/def/se=
rvlet/SC.web?c=3D$bpINDU,uu[h,a]dbclniay[df][pc13!c20!f][vc60][i]&pre=
f=3DG</A></FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>And the BP for the SPX:</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2><A=20
href=3D"http://stockcharts.com/def/servlet/SC.web?c=3D$BPspx,uu[h,a]dbcln=
iay[df][pc13!c20!f][vc60][i]&pref=3DG">http://stockcharts.com/def/ser=
vlet/SC.web?c=3D$BPspx,uu[h,a]dbclniay[df][pc13!c20!f][vc60][i]&pref=3D=
G</A></FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>We are definitely picking up a unform =
pattern of=20
highs not seen before (translation: everything is as bullish as =
possible,=20
meaning there's just one way to go. if you can't get more bullish, =
it's=20
the top).</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>While you have the SPX chart open, just =
look at the=20
3 previous spikes of 77 (April 2002), 59.80 (Aug 2002) and 68.40 =
(Dec.=20
2002), and look back to what the SPX did after those =
moments:</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2><A=20
href=3D"http://stockcharts.com/def/servlet/SC.web?c=3D$SPX,uu[h,a]dbclnia=
y[df][pc13!c20!f][vc60][i]&pref=3DG">http://stockcharts.com/def/servl=
et/SC.web?c=3D$SPX,uu[h,a]dbclniay[df][pc13!c20!f][vc60][i]&pref=3DG<=
/A></FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>77 (April 2002)--SPX went from 1150 to =
775 in 5=20
months.</FONT></DIV>
<DIV><FONT face=3DArial size=3D2>59.80 (Aug 2002)--SPX went =
from 965=20
to 768 in 1.5 months</FONT></DIV>
<DIV><FONT face=3DArial size=3D2>68.40 (Dec. 2002)--SPX went =
from 950=20
to 800 in 3 months.</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>Anyway, it's all very interesting to =
look at, isn't=20
it? Elliot Wavers might see this overly bullish scenario as the =
setup for=20
yet another 3-count wave down. I don't really subscribe to EW =
stuff, but,=20
like FIbonacci and Gann, it's useful to at least think about. The =
last EW=20
pattern, if you believe this stuff, took the SPX down from 1500 to 768, =
or a 50%=20
retrace. This one, starting at 1015.40, could do some similar =
damage and=20
take us down to 565-775 over a 12 month period. Some bearish =
reports I've=20
see predict a SPX fall to the mid 600s before year end.</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>Otoh, we're in the 3rd political year, =
and 3 and 4=20
are notoriously good. And, if you do a big Fibo study on the SPX =
since its=20
base in 1995 at about 440, we've already done a 38% retrace (back to the =
62%=20
line).</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2><A=20
href=3D"http://stockcharts.com/def/servlet/SC.web?c=3D$spx,uu[h,a]mbclnia=
y[pc13!c20!f][vc60][i][J15983278,Y]&pref=3DG">http://stockcharts.com/=
def/servlet/SC.web?c=3D$spx,uu[h,a]mbclniay[pc13!c20!f][vc60][i][J1598327=
8,Y]&pref=3DG</A></FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>All things to think about on a nice, =
calm, summer=20
Sunday's evening.</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2>DMC</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<DIV><FONT face=3DArial size=3D2></FONT> </DIV>
<BLOCKQUOTE dir=3Dltr=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=3Dhefner@swbell.net href=3D"mailto:hefner@swbell.net">WJH</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> Sunday, August 10, 2003 =
10:00=20
AM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> Fw: [CANSLIM] for =
Short=20
Selling</DIV>
<DIV><BR></DIV>
<DIV>
<DIV>Sounds interesting.</DIV>
<DIV><FONT face=3D"Comic Sans MS"></FONT> </DIV></DIV>
<BLOCKQUOTE=20
style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; =
BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
<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>=
=20
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Saturday, August 09, =
2003 6:41=20
PM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> Re: [CANSLIM] for =
Short=20
Selling</DIV>
<DIV><BR></DIV>Rolf & Mark,<BR><BR>My vote (if I get a vote) is =
why not=20
discuss how to use canslim ideas to<BR>generate potential =
shorts? It's=20
not like this little epistolary group<BR>hasn't gone off the track =
since=20
I've been here (about 10 trading days), and<BR>it's not like it =
takes a=20
lifetime to figure out Canslim in any event. It's<BR>really =
rather=20
simple, and with the help of computers it's almost too easy.<BR>The =
real=20
difficulty lies in disciplining oneself to limit or get rid =
of<BR>longs in=20
sideways and topping markets, and be willing to reenter when =
the<BR>market's=20
correction has ended and stocks are ready to rise again. You=20
can<BR>find the names of candidates very easily for a little coin =
paid for=20
a<BR>subscription to IBD and/or a subscription to =
canslim.net.<BR><BR>For=20
short discussions, let's just use the above referenced subject =
line<BR>"Re:=20
[CANSLIM] for Short Selling"<BR><BR>and the purists like Fanus et al =
(so far=20
it seems to be all Fanus) can<BR>either eyeball them and delete =
them, or=20
even program their Outlook Express<BR>to pre-delete all messages on =
the=20
peripheral topic.<BR><BR>I think it would be helpful to understand =
what kind=20
of screen would generate<BR>the opposite of good longs in a bad =
market, if=20
only for academic,<BR>mind-sharpening purposes. After all, if =
in=20
traditional canslim technique<BR>you are looking for 1 or 2 stocks =
to buy=20
per week in a good (M!) market,<BR>then why not reverse the order in =
a bad=20
(M!) market.<BR><BR>With that in mind, I'd like to explore what =
kinds of=20
things people think<BR>would indicate a dangerous market, knowing in =
advance=20
that calling a top is<BR>one of the hardest things to do BUT that =
falls tend=20
to be so much more<BR>precipitous than climbs that there's gold in =
those=20
hills if you can time it<BR>right and buy a put to get into=20
position.<BR><BR>In any event, VTO has provided a very handy site =
with lots=20
of sentiment<BR>indicators:<BR><BR><A=20
=
href=3D"http://www.vtoreport.com/sentiment/cot.htm">http://www.vtoreport.=
com/sentiment/cot.htm</A><BR><BR>If=20
you click on Sentiment and Bull/Bear you can see a very wide gap=20
between<BR>bullish and bearish advisors, the kind which indicates a=20
correction is<BR>coming. I'd say anytime you see a gap of 25% =
or more=20
(with the bulls on<BR>top) you are looking at a dangerous=20
situation.<BR><BR>The Put/Call ratio has been very low and is now=20
climbing. Again danger.<BR><BR>The VIX has been unnaturally =
low for a=20
long time, another coiled spring.<BR><BR>For COTS, I prefer to use =
the=20
Quasimodos.com site:<BR><BR><A=20
=
href=3D"http://www.quasimodos.com/marketrider/technical.php">http://www.q=
uasimodos.com/marketrider/technical.php</A><BR><BR>The=20
articles are interesting, and to get the reports and COTs page,=20
click<BR>here:<BR><BR><A=20
=
href=3D"http://www.quasimodos.com/marketrider/charts.php">http://www.quas=
imodos.com/marketrider/charts.php</A><BR><BR>You=20
can't paste the sites, but the first 3 on the right, for the Dow, =
the<BR>Naz=20
and the SPX have a very interesting graphic display of the=20
traders'<BR>positions. I don't know exactly what the timing is =
on=20
these but the smart<BR>money seems to be betting against this market =
continuing, while the small<BR>speculators keep piling on the=20
positions. Good bull markets (like the one<BR>we had from =
March to=20
June) often begin with very small=20
bars.<BR><BR>DMC<BR></BLOCKQUOTE></BLOCKQUOTE></BODY></HTML>
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