From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #1227 Reply-To: canslim Sender: owner-canslim-digest@lists.xmission.com Errors-To: owner-canslim-digest@lists.xmission.com Precedence: bulk Content-Transfer-Encoding: quoted-printable X-No-Archive: yes canslim-digest Saturday, March 24 2001 Volume 02 : Number 1227 In this issue: Re: [CANSLIM] DOW 7000? Re: [CANSLIM] Watch Lists and IBD Weekend Review Re: [CANSLIM] Watch Lists and IBD Weekend Review On tax cuts (was Re: [CANSLIM] fomc released 1/30-31 minutes) Re: On tax cuts (was Re: [CANSLIM] fomc released 1/30-31 minutes) [CANSLIM] Analyst Ratings Re: [CANSLIM] DOW 7000? Re: [CANSLIM] Watch Lists and IBD Weekend Review [CANSLIM] When to buy during the day? Re: [CANSLIM] When to buy during the day? [CANSLIM] Watch Lists and IBD Weekend Review [CANSLIM] ot question for chartreaders please. TLGD Re: [CANSLIM] ot question for chartreaders please. TLGD [CANSLIM] stocks Re: [CANSLIM] Watch Lists and IBD Weekend Review Re: [CANSLIM] ot question for chartreaders please. TLGD Re: [CANSLIM] ot question for chartreaders please. TLGD RE: [CANSLIM] DOW 7000? Re: [CANSLIM] stocks Re: [CANSLIM] DOW 7000? Re: [CANSLIM] DOW 7000? ---------------------------------------------------------------------- Date: Fri, 23 Mar 2001 19:22:21 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] DOW 7000? Dave, What is your basis for using such a long timeline? A lot has changed just in 10 years, much less 14. Back then, we didn't have an internet, very few brokerage houses even had electronic order entry for the brokers. Forget about online trading for clients. If a client wanted to know something, even something as simple as a stock quote, he called his broker. There were a few discount houses, whose commissions were still far higher than today. And a lot more people thought investing meant putting money into their savings account, or maybe buying a CD (and I don't mean one of those things that plays music, much less a movie, they hadn't been invented then either). My point is that much has changed, and in so doing has changed both the market itself, and its environment. Nothing wrong in trying to guess where support will be found, hopefully it causes you to develop a plan or make decisions on anything you might still be holding. But I would suggest a more realistic "long" timeline would be no more than 3-5 years. But ultimately the different indexes will find support where they find support. This selloff is both fundamentally and emotionally driven. Both must be cured for real support. The former may be helped by the rate cuts, but the latter will only be changed when real money begins to flow back into stocks, and continues doing so, reflecting a sea change in attitude. Tom Worley stkguru@netside.net ICQ # 5568838 - ----- Original Message ----- From: Dave Rubin To: Sent: Friday, March 23, 2001 10:20 AM Subject: [CANSLIM] DOW 7000? Did anyone else look at the chart of the DOW on page 1 of IBD and come to the scary realization that the DOW is still very much extended on a long-term basis? Drawing a long-term trendline from 1987 comes to around 7000 now. Even if the DOW did fall to 7000 it would represent "only" a 40% drop from its peak. This is still less than the 60% drop for the Nasdaq. Long-term charts for the Nasdaq tell a different story, with the trendline from the mid-1990 low landing at around 1600-1700 now. Combined with the overly bullish sentiment, lack of true capitulation, and continued economic uncertainty, it seems possible (though probably unlikely) that the DOW could fall much further here. Just some random food for thought... - - - - ------------------------------ Date: Fri, 23 Mar 2001 16:32:13 -0700 From: esetser Subject: Re: [CANSLIM] Watch Lists and IBD Weekend Review Well, here's my take. See answers with your questions below. At 12:25 PM 3/23/01 -0500, you wrote: >Earl or anyone, > >Back on 1/3/2001 Earl Setser posted some good ideas for generating watch >lists from IBD. >In particular, the second one had to do with the Friday weekend review: > > > 2 - Get Friday's IBD and look through the "weekend review" list. This >is a > > great place for ideas, especially after weakness in the Market like >now. I > > generally try to draw a line where the group strength changes from "B" >to > > "C", and I only look at stocks above the line. (The group is sorted by > > industry group strength, so the top groups are at the head of the list, >etc.). > >Question: >In order to determine the cutoff for drawing the line between groups of >strength "B" vs. >"C", how do you find the group strength? I use the paper to find out where the cutoff is. In other words, I grab the NASDAQ section and start somewhere in the 2nd column, maybe halfway, and check one stock. To get it quicker, I sometimes pick the 79 or 80th group, and see if I can identify a stock from the group to start. Then I check a stock in the paper. Say it's a "B", I jump down maybe 10 stocks, and check that one, etc. Eventually, I find the crossover point from "B" to "C". I see the group strength listed >for the charts at the top of the page, but they are mostly group "A" stocks. > Yes, the charts seem to me to be a snapshot of one group of stocks from below. I've never figured out how they chose the stocks, it almost seems like they pick a random stock and run down the list. I think I've even seen "C" rated stocks in the graphs occasionally. >Also, does anyone know what the correlation is between the group strength >"A" to "E" rating, and the individual numeric (1 to 197) rating given on the >Industry Groups page in Section A of IBD? > If by Group Strength, you mean the number (i.e. 67 or 98), I don't think the correlation is fixed, and this data seems to be available only in DGO. No wait, something similar IS available in the IBD stock checkup, called "Group Technical Rating". It looks like this is different, but probably similar to the Group RS we get in DGO. As far as "A" to "E", IBD just splits the groups into the top 20% (A), next 20% (B), etc. So the top 39 or 40 groups should be "A", and the next 39 or 40 groups should be "B", and so on. >Thanks, > Barry > > >- > > > - - ------------------------------ Date: Fri, 23 Mar 2001 19:32:13 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] Watch Lists and IBD Weekend Review Barry, As far as I know, there is no direct correlation between the numerical group rankings (1-197) and the Group RS letter rating. I would think the division between a "B" group and a "C" group in terms of the numerical group ranking could vary widely depending on "M" at that time. Tom Worley stkguru@netside.net ICQ # 5568838 - ----- Original Message ----- From: Barry Marx To: Sent: Friday, March 23, 2001 12:25 PM Subject: [CANSLIM] Watch Lists and IBD Weekend Review Earl or anyone, Also, does anyone know what the correlation is between the group strength "A" to "E" rating, and the individual numeric (1 to 197) rating given on the Industry Groups page in Section A of IBD? Thanks, Barry - - - - ------------------------------ Date: Fri, 23 Mar 2001 19:56:40 -0500 From: "Tom Worley" Subject: On tax cuts (was Re: [CANSLIM] fomc released 1/30-31 minutes) Hi Jans, The general opinion is that P&G blew it in running a successful business. Raised prices when competitors were stable or lowering prices, thus costing them market share. Spent way too much money developing new products that didn't sell. Maintained production, and employment, long after sales were slipping, leading both to higher costs and higher inventory. And their inventory isn't one of those things that you can do a weekend "30% off" sale and clear out. More likely they will increase coupon programs, advertising, and special deals for retailers, all translating to more costs per revenue dollar. It's hard to get people to buy more of a consumable unless they consume more. So, you discount and they buy three months supply instead of one or two weeks. Inventory goes down, but now they don't buy again for three months. The Federal Budget is an insidious beast, in part because it is so large and complex, and the amount of money involved so vast that it is beyond most normal human's real understanding and appreciation. Like is often said, save a billion here, save a billion there, and pretty soon you have some real money. A tax cut has merit right now as an economic stimulus. However, if the cut only adds 10-20 dollars to an individual's paycheck every two weeks, he doesn't feel much richer, or likely to go out and spend that $10-20 plus some more. A better bet would be an instant rebate of 5-10% or so of year 2000's taxes paid in a lump sum. The govt should already have everyone's taxable income and taxes withheld in their computer database. They should easily be able to figure out how much to rebate across the board and not bust the budget. I strongly support using the budget surplus to pay off the nat'l debt first before we start making long term cuts in tax rates. I would also like to see an immediate elimination of inheritance taxes and capital gains taxes (at least on those held over one year). I would exclude employee stock options from this exemption (taxes due on exercise), but shares purchased that way and held over one year would qualify for a partial rebate of the taxes paid on exercise. A tax cut, even if made retroactive to Jan 1, 2001, just doesn't have the impact we need right now. Sure, for the next 9.5 months you have a little more in each paycheck. But that disappears rapidly, and takes another 9.5 months to be fully realized. And the adverse reaction if that tax cut must be offset by a future tax hike when income is no longer so strong is far worse to the economy and the consumer's spending psychology. I do believe that the budget surplus should be taken out of the hands of Congress, they are even more antsy than some of us to buy something. Pay down the nat'l debt, then you not only add in the cumulative effect of paying less interest (further reducing the threat of Japan selling off it's holdings of US Treasuries in the process), but the govt becomes less of a demand for the credit available, and rates will decline on their own through competition (less demand for the same supply of credit). Tom Worley stkguru@netside.net ICQ # 5568838 - ----- Original Message ----- From: To: Sent: Friday, March 23, 2001 1:17 PM Subject: Re: [CANSLIM] fomc released 1/30-31 minutes Tom: I know you're familiar with the item that P&G (one of the biggest employers here in Cincinnati) is letting go about 3000 employees (just in Cincy alone) because of lagging sales. Also, Inventory/Sales is over 1.00 at 1.25 (I believe this is doubley treacherous because with new computer programs, I/S should be more balanced-and if it isn't then it denotes to me that the economy is VERY weak). Meanwhile, consumer spending is dropping and so is Consumer Sentiment. My point is that people aren't buying, and with Consumer Spending about 70% of economic activity, we need more than just an interest rate cut, I believe, to avert recession: We need consumers to spend to reduce the inventory surplus in order to justify the current high employment. Thus, in my opinion, we need a hefty tax cut so that people will feel wealthy again . Consumers must spend again, and they also must become more confident. The stock market plummet has reversed the wealth effect (consumers feeling more wealthy because of their capital gains in the market). The only way to reverse the reverse of the wealth effect is to let consumers keep more of their earnings-and Washington should do this quickly, while we still have a surplus (and before the number unemployed jumps leading to less of a surplus). jans >>After reading the minutes, it strengthened my opinion previously expressed that the slowdown in manufacturing activity in the Fourth Quarter was steeper than anticipated by FOMC, and resulted in an even greater inventory build up than expected. Obviously, manufacturers were also caught by surprise. I noted a number of comments regarding the wealth effect of the equity markets, and its negative impact on consumer sentiment given the decline in markets. I also noted a forecast of unemployment rising to 4.5% by year end, which should keep the ECI (Employment Cost Index) quite tame. Drat, guess I better not push too hard for a pay raise. It's frustrating that we must wait two months to read the minutes of the latest meeting, however I will go on record as expecting another rate cut between now and the May 15 meeting. There is much economically to be reported, but I would think a cut of 25 BP is far more likely than 50 BP if it occurs between meetings. If no cut before May 15, then the odds shift in favor of another 50 BP at the meeting, unless the economic reports show a sharp improvement. FOMC clearly recognized that a lot of economic activity was stirred up in January (and may have continued in February) as deep discounting was put into effect to reduce the sharp increase in inventories. So the strength of the Jan reports would seem to have been discounted. Inflation continues to be a non-event, and does not seem to be of concern for the balance of the year. All in all, interesting reading for anyone that likes macro economics, or is interested in the FOMC views as they may impact the equity markets. Tom Worley stkguru@netside.net ICQ # 5568838 << - - - - ------------------------------ Date: 23 Mar 2001 18:32:57 -0800 From: "Tim Fisher" Subject: Re: On tax cuts (was Re: [CANSLIM] fomc released 1/30-31 minutes) Well heck Tom, if you have a few thousand MCD options at exercise prices of between 29 and 45, you have to PAY to cash them in. No taxes! So I for one don't think we need to cut the tax on option! P.S. If you detected _irony_ in the above statement, you're smarter than you think ;} At 07:56 PM 3/23/2001 -0500, you wrote: >Hi Jans, > >I would exclude employee stock options from this exemption >(taxes due on exercise), but shares purchased that way and held >over one year would qualify for a partial rebate of the taxes >paid on exercise. > > >Tom Worley >stkguru@netside.net >ICQ # 5568838 > > >----- Original Message ----- >From: >To: >Sent: Friday, March 23, 2001 1:17 PM >Subject: Re: [CANSLIM] fomc released 1/30-31 minutes > > >Tom: > > I know you're familiar with the item that P&G (one of the >biggest >employers here in Cincinnati) is letting go about 3000 employees >(just in >Cincy alone) because of lagging sales. Also, Inventory/Sales is >over 1.00 at >1.25 (I believe this is doubley treacherous because with new >computer >programs, I/S should be more balanced-and if it isn't then it >denotes to me >that the economy is VERY weak). Meanwhile, consumer spending is >dropping and >so is Consumer Sentiment. > > My point is that people aren't buying, and with Consumer >Spending about >70% of economic activity, we need more than just an interest rate >cut, I >believe, to avert recession: We need consumers to spend to reduce >the >inventory surplus in order to justify the current high >employment. > > Thus, in my opinion, we need a hefty tax cut so that people >will feel >wealthy again . Consumers must spend again, and they also must >become more >confident. The stock market plummet has reversed the wealth >effect (consumers >feeling more wealthy because of their capital gains in the >market). The only >way to reverse the reverse of the wealth effect is to let >consumers keep more >of their earnings-and Washington should do this quickly, while we >still have >a surplus (and before the number unemployed jumps leading to less >of a >surplus). > >jans > > >>After reading the minutes, it strengthened my opinion >previously >expressed that the slowdown in manufacturing activity in the >Fourth Quarter was steeper than anticipated by FOMC, and resulted >in an even greater inventory build up than expected. Obviously, >manufacturers were also caught by surprise. I noted a number of >comments regarding the wealth effect of the equity markets, and >its negative impact on consumer sentiment given the decline in >markets. I also noted a forecast of unemployment rising to 4.5% >by year end, which should keep the ECI (Employment Cost Index) >quite tame. Drat, guess I better not push too hard for a pay >raise. > >It's frustrating that we must wait two months to read the minutes >of the latest meeting, however I will go on record as expecting >another rate cut between now and the May 15 meeting. There is >much economically to be reported, but I would think a cut of 25 >BP is far more likely than 50 BP if it occurs between meetings. >If no cut before May 15, then the odds shift in favor of another >50 BP at the meeting, unless the economic reports show a sharp >improvement. > >FOMC clearly recognized that a lot of economic activity was >stirred up in January (and may have continued in February) as >deep discounting was put into effect to reduce the sharp increase >in inventories. So the strength of the Jan reports would seem to >have been discounted. > >Inflation continues to be a non-event, and does not seem to be of >concern for the balance of the year. > >All in all, interesting reading for anyone that likes macro >economics, or is interested in the FOMC views as they may impact >the equity markets. > >Tom Worley >stkguru@netside.net >ICQ # 5568838 << > >- > > > >- Tim Fisher, 1995 President, Pacific Fishery Biologists Ore-ROCK-On Rockhounding Web Site PFB Information mailto:tim@OreRockOn.com WWW http://OreRockOn.com - - ------------------------------ Date: Fri, 23 Mar 2001 21:43:31 -0700 From: "Patrick Wahl" Subject: [CANSLIM] Analyst Ratings Someone on the Canslim board posted this from Briefing.com, I thought it was pretty funny, certainly jibes with my opinion of analysts - Originally, we thought Manugistics (MANU 24 7/8 -1/8) would occupy the title space of this story. The more we thought about it, though, we realized the ensuing story was going to be more about the investment recommendation made today on Manugistics by Dain Rauscher Wessels than it would be about Manugistics. With that in mind, Dain Rauscher started coverage of MANU today with a BUY-AGGRESSIVE rating. The "aggressive" portion of that opinion is issued to identify the inherent risk involved with buying the stock. To us, BUY-AGGRESSIVE means the stock has potential to run, but that it is a risky proposition best-suited for investors with a high-risk tolerance. The analyst, Kash Rangan, was kind enough to spell out some of the risks in a detailed research note and they include the following: a slowing economy that is causing cutbacks in IT budgets, MANU's quarters being back-end loaded, a product integration risk with Talus, and tough software license comparisons beginning in 1Q02 (May). Those risks aside, apparently he still feels MANU is a BUY for the proper target audience (risk tolerant investors). Fair enough, Mr. Rangan, but what we can't understand is why you started coverage at BUY- AGGRESSIVE and then set a noteworthy, 12-month price target of $25. For those of you who haven't caught the irony yet, bear in mind that MANU ended yesterday's session at $25. Frankly, we thought the price target was a misprint when we first saw it, but it isn't; so, if we understand the rating correctly (and we're sure Dain Rauscher would say we don't), an "aggressive" investor should buy the stock, and in the process expose him/herself to any number of risks that could cause a material selloff, but expect zero return for the next year? Don't know about you, but we don't exactly find that to be a compelling investment recommendation. Strikingly, there was a little disclaimer at the end of the research note that Dain Rauscher makes a market in MANU. Suddenly, the inane nature of the rating makes a little more sense, but it doesn't make it any better. With calls like these, it is no wonder investors have felt increasingly manipulated, mistrustful, and angered by the babble from analysts. - - ------------------------------ Date: Fri, 23 Mar 2001 23:08:11 -0600 From: "walter nusbaum" Subject: Re: [CANSLIM] DOW 7000? > Dave, > > What is your basis for using such a long timeline? (Snip) Tom Worley > stkguru@netside.net > ICQ # 5568838 > > > ----- Original Message ----- > From: Dave Rubin > To: > Sent: Friday, March 23, 2001 10:20 AM > Subject: [CANSLIM] DOW 7000? > > > Did anyone else look at the chart of the DOW on page 1 of IBD and > come to > the scary realization that the DOW is still very much extended on > a > long-term basis? > > Drawing a long-term trendline from 1987 comes to around 7000 now. Dave, In Thomas DeMark's, "The New Science of Technical Analysis", he notes that the drawing of trend lines is a highly arbitrary process, and that the trend line that provides the best fit is truly in the eye of the beholder. Demark recognizes that in order for a trend line to be defined precisely and unambiguously, it must be based on exactly two points, and that contrary to popular convention, trend lines should be drawn from right to left because recent price activity is more significant than historical movement. So, according to Demark and using his right to left approach, perhaps the best that can be said of the IBD chart is that the DOW can be presently viewed as being in a down trend. 'Course, that depends on the "eye of the beholder". ;) Best wishes, Walt - - ------------------------------ Date: Fri, 23 Mar 2001 22:19:46 -0700 From: esetser Subject: Re: [CANSLIM] Watch Lists and IBD Weekend Review Hmm, I thought it was simply a 20% each split. Looking at IBD, it doesn't say. Well, how about a little emperical study. From today's paper: Shoes & Related Apparel 39 A Banks-West/Southwest 40 A Medical/Dental/Serv 41 B Metal Prod-Fasteners 80 B Comml Svcs-Security/Sfty 81 C Fin-Pub Trd Inv Fd-Eqt 120 C Transportation-Equip Mfg 121 D Transport-Air Freight 160 D Comml Serv-Staffing 161 E Well, I think that pretty much confirms it. Starting with A, each category includes exactly 40 industry groups. That leaves only 37 groups with a rating of E, but it pretty much is 20% for each letter. FYI, I used the DGO Index list to pick a stock from each group, and looked up the industry group rank in the paper to be sure I had the same day's rankings with the group rankings. At 07:32 PM 3/23/01 -0500, you wrote: >Barry, > >As far as I know, there is no direct correlation between the >numerical group rankings (1-197) and the Group RS letter rating. >I would think the division between a "B" group and a "C" group in >terms of the numerical group ranking could vary widely depending >on "M" at that time. > >Tom Worley >stkguru@netside.net >ICQ # 5568838 > > >----- Original Message ----- >From: Barry Marx >To: >Sent: Friday, March 23, 2001 12:25 PM >Subject: [CANSLIM] Watch Lists and IBD Weekend Review > > >Earl or anyone, > >Also, does anyone know what the correlation is between the group >strength >"A" to "E" rating, and the individual numeric (1 to 197) rating >given on the >Industry Groups page in Section A of IBD? > >Thanks, > Barry > > >- > > > >- > > > - - ------------------------------ Date: Sat, 24 Mar 2001 03:49:31 -0500 From: "Robert McGill" Subject: [CANSLIM] When to buy during the day? Is there any particular time that you should generally make your buys? - - ------------------------------ Date: Sat, 24 Mar 2001 05:24:26 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] When to buy during the day? try to avoid buying in the first half hour. Give the market time to confirm your opinion of both "M" and the stock you want. It's no guarantee you will end up on the right side by the end of the day, just improves the odds a little in your favor. Tom Worley stkguru@netside.net ICQ # 5568838 - ----- Original Message ----- From: Robert McGill To: Sent: Saturday, March 24, 2001 3:49 AM Subject: [CANSLIM] When to buy during the day? Is there any particular time that you should generally make your buys? - - - - ------------------------------ Date: Sat, 24 Mar 2001 04:03:03 -0800 (PST) From: Steve F Subject: [CANSLIM] Watch Lists and IBD Weekend Review HELP ! I am still lost on the Weekend Review. It states that stocks are shown by Industry Group Strength Rating and I just don't see that the stocks are listed by Industry or where the Industry Strenghth Rating is listed. Thanks Steve __________________________________________________ Do You Yahoo!? Get email at your own domain with Yahoo! Mail. http://personal.mail.yahoo.com/ - - ------------------------------ Date: Sat, 24 Mar 2001 07:20:51 -0500 From: "Robert McGill" Subject: [CANSLIM] ot question for chartreaders please. TLGD I am trying to learn to read charts and here is one I'm trying to analyze. My objective here is for a quick trade, maybe a couple weeks until it started to break down, btw, I'm not really doing this, just trying to analyze the chart. The stock is TLGD. This stock is on an uptrend on increasing volume and price, with a breakaway gap which occurred at the open on friday. Jiler, in "How Charts Can Help You in the Stock Market", pp-139 says breakaway gaps often mark the beginning of a major price move. My question is, How would you play this? My instinct would be to wait until approx 1/2 hour after the open and see if the stock pulled back to 23 11/16 where it opened on Fri with a stop loss under 22 5/16 where it closed prior to the gap up. Of course, if it continued to show strength rather pull back I would take this as confirmation of the uptrend and buy in immediately with a stop at the price it opened on the day it gapped up, 23 11/16. All indicators, rsi, obv and money flow are on upward trend and I couldn't find any probs, ( I think) on DGO. Like I said, this is just an exercise and if someone good at reading charts would critique this for me I would appreciate it. Bob - - ------------------------------ Date: Sat, 24 Mar 2001 10:42:50 -0500 From: "Young Bowlden" Subject: Re: [CANSLIM] ot question for chartreaders please. TLGD I am not a TA expert but see the daily chart in a descending triangle pattern. It closed friday exactly at resistence of 26.87. I am not convienced this market is headed up for long and actually believe it will not see much of a rally( which has nothing to do with the chart) but would expect TLGD to pull back,close the gap and test support at 20.50. TLGD did however close above its 30ema which is bullish and should it break above the down trend line at 30.00 it would definetly be worth looking at if we were in a better market. I am just learning to read charts and would not suggest you make any investment descisions based on anything I say. I am just throwing my interpetation of the chart out there to see the response of others. - ----- Original Message ----- From: Robert McGill To: Sent: Saturday, March 24, 2001 7:20 AM Subject: [CANSLIM] ot question for chartreaders please. TLGD > I am trying to learn to read charts and here is one I'm trying to analyze. > My objective here is for a quick trade, maybe a couple weeks until it > started to break down, btw, I'm not really doing this, just trying to > analyze the chart. The stock is TLGD. This stock is on an uptrend on > increasing volume and price, with a breakaway gap which occurred at the open > on friday. Jiler, in "How Charts Can Help You in the Stock Market", pp-139 > says breakaway gaps often mark the beginning of a major price move. My > question is, How would you play this? My instinct would be to wait until > approx 1/2 hour after the open and see if the stock pulled back to 23 11/16 > where it opened on Fri with a stop loss under 22 5/16 where it closed prior > to the gap up. Of course, if it continued to show strength rather pull back > I would take this as confirmation of the uptrend and buy in immediately with > a stop at the price it opened on the day it gapped up, 23 11/16. All > indicators, rsi, obv and money flow are on upward trend and I couldn't find > any probs, ( I think) on DGO. Like I said, this is just an exercise and if > someone good at reading charts would critique this for me I would appreciate > it. Bob > > > - > > - - ------------------------------ Date: Sat, 24 Mar 2001 09:17:41 -0700 From: "Patrick Wahl" Subject: [CANSLIM] stocks I haven't even been trying to find any stocks for several weeks, but today I decided to run a scan that looks for new highs. Turned up one very good chart, ADVP, another that looks pretty good, SFD. M is still awful, so the risk of buying a breakout is higher than usual. Still, I guess is says something good about a stock like ADVP if it can hang at near its high while the market is getting clocked. - - ------------------------------ Date: Sat, 24 Mar 2001 09:21:37 -0700 From: esetser Subject: Re: [CANSLIM] Watch Lists and IBD Weekend Review OK, I think I can explain this. Looking at this week's paper, the first 11 stocks (From top left) are NVR, LEN, HOV, FARM, HOTT, TJX, DEBS, BCF, SHFL, SLOT, and AN. If you look in the paper, you will find all ten are ranked "A" for the industry group. Here's some more data on these (I used DGO to look up the actual group for each stock): NVR - Bldg-Resident/Commrcl, Group Rank #3 LEN - Bldg-Resident/Commrcl, Group Rank #3 HOV - Bldg-Resident/Commrcl, Group Rank #3 FARM - Retail/Wholesale-Food, Group Rank #4 HOTT - Retail-Apparel/Shoe, Group Rank #6 TJX - Retail-Apparel/Shoe, Group Rank #6 DEBS - Retail-Apparel/Shoe, Group Rank #6 BCF - Retail-Apparel/Shoe, Group Rank #6 SHFL - Leisure-Gaming, Group Rank #8 SLOT - Leisure-Gaming, Group Rank #8 AN - Retail-Misc/Diversified Group Rank #10 As you can see, as you go down the list, the group rank of the stocks increases from 3 to 4 to 6 to 8 and finally to 10. If you look at the very last stock on the list, TARO, it is in Medical-Generic Drugs which is Group Rank of 174(and that's an "E" rank). You will note that some of the groups don't have any stocks on the list. For instance, Tobacco is the number 1 group, but there aren't any stocks that meet the Weekend Review criteria. Apparently, neither does Medical-Outpnt/Hm Care (#2). For stocks in the same group, I think they are ordered by the highest total of EPS+RS. I used Group Rank to explain this, although the paper says "Group Relative Strength Rating". I believe that IBD used Group Relative Strength (a number from 1 to 99 that is available at DGO) to establish the group rank (1 to 197). If I'm correct, the answer is the same. As you go down the list, you will eventually change from "A" group stocks to "B", then "C", etc. I hope this makes sense. If you are still confused, let us know. After all, that IS the whole purpose of the group! At 04:03 AM 3/24/01 -0800, you wrote: >HELP ! > >I am still lost on the Weekend Review. It states that >stocks are shown by Industry Group Strength Rating and >I just don't see that the stocks are listed by >Industry or where the Industry Strenghth Rating is >listed. >Thanks >Steve > > >__________________________________________________ >Do You Yahoo!? >Get email at your own domain with Yahoo! Mail. >http://personal.mail.yahoo.com/ > >- > > > - - ------------------------------ Date: Sat, 24 Mar 2001 09:28:37 -0700 From: esetser Subject: Re: [CANSLIM] ot question for chartreaders please. TLGD First, this isn't the kind of chart I have any experience, so I won't try to discuss your "VERY non-CANSLIM" interest in this stock. However, I do see one BIG concern anyway. The stock moved right up to the 200 day MA on Friday and bounced lower. I would consider the 200 day significant resistance at this point, and I would be very hesitant to buy below that point. I think you would like to see it move above there before making any decision. It was interesting to see the chart after reading your message. I certainly didn't expect to see a long downtrend with only 2 days of significant moves up based on your description. I would have to wonder what this stock will do if the market shows any weakness at all on Monday. At 07:20 AM 3/24/01 -0500, you wrote: >I am trying to learn to read charts and here is one I'm trying to analyze. >My objective here is for a quick trade, maybe a couple weeks until it >started to break down, btw, I'm not really doing this, just trying to >analyze the chart. The stock is TLGD. This stock is on an uptrend on >increasing volume and price, with a breakaway gap which occurred at the open >on friday. Jiler, in "How Charts Can Help You in the Stock Market", pp-139 >says breakaway gaps often mark the beginning of a major price move. My >question is, How would you play this? My instinct would be to wait until >approx 1/2 hour after the open and see if the stock pulled back to 23 11/16 >where it opened on Fri with a stop loss under 22 5/16 where it closed prior >to the gap up. Of course, if it continued to show strength rather pull back >I would take this as confirmation of the uptrend and buy in immediately with >a stop at the price it opened on the day it gapped up, 23 11/16. All >indicators, rsi, obv and money flow are on upward trend and I couldn't find >any probs, ( I think) on DGO. Like I said, this is just an exercise and if >someone good at reading charts would critique this for me I would appreciate >it. Bob > > >- > > > - - ------------------------------ Date: Sat, 24 Mar 2001 09:30:27 -0700 From: esetser Subject: Re: [CANSLIM] ot question for chartreaders please. TLGD Whoops, make those comments the 50 day, not the 200 day. I'm not used to looking at any charts that have the 200 day ABOVE the 50 day. :-) >Date: Sat, 24 Mar 2001 09:28:37 -0700 >To: canslim@lists.xmission.com >From: esetser >Subject: Re: [CANSLIM] ot question for chartreaders please. TLGD >In-Reply-To: <000a01c0b45c$dfc82280$123245cf@default> > >First, this isn't the kind of chart I have any experience, so I won't try to discuss your "VERY non-CANSLIM" interest in this stock. However, I do see one BIG concern anyway. The stock moved right up to the 200 day MA on Friday and bounced lower. I would consider the 200 day significant resistance at this point, and I would be very hesitant to buy below that point. I think you would like to see it move above there before making any decision. > >It was interesting to see the chart after reading your message. I certainly didn't expect to see a long downtrend with only 2 days of significant moves up based on your description. I would have to wonder what this stock will do if the market shows any weakness at all on Monday. > >At 07:20 AM 3/24/01 -0500, you wrote: >>I am trying to learn to read charts and here is one I'm trying to analyze. >>My objective here is for a quick trade, maybe a couple weeks until it >>started to break down, btw, I'm not really doing this, just trying to >>analyze the chart. The stock is TLGD. This stock is on an uptrend on >>increasing volume and price, with a breakaway gap which occurred at the open >>on friday. Jiler, in "How Charts Can Help You in the Stock Market", pp-139 >>says breakaway gaps often mark the beginning of a major price move. My >>question is, How would you play this? My instinct would be to wait until >>approx 1/2 hour after the open and see if the stock pulled back to 23 11/16 >>where it opened on Fri with a stop loss under 22 5/16 where it closed prior >>to the gap up. Of course, if it continued to show strength rather pull back >>I would take this as confirmation of the uptrend and buy in immediately with >>a stop at the price it opened on the day it gapped up, 23 11/16. All >>indicators, rsi, obv and money flow are on upward trend and I couldn't find >>any probs, ( I think) on DGO. Like I said, this is just an exercise and if >>someone good at reading charts would critique this for me I would appreciate >>it. Bob >> >> >>- >> >> >> - - ------------------------------ Date: Sat, 24 Mar 2001 11:40:22 -0500 From: "Dave Rubin" Subject: RE: [CANSLIM] DOW 7000? > What is your basis for using such a long timeline? No basis really, just happened to see the chart in IBD and the trendline was clear. It's true a lot has changed, but the market also depicts the psychology of the masses, and that is pretty much a constant. That said, I agree that a long-term trend can not predict where the market will go. As you said, nothing can accurately predict that. Do I expect DOW to go to 7000? No, but at this point, I wouldn't be shocked either... - -- Dave - - ------------------------------ Date: Sat, 24 Mar 2001 09:45:52 -0800 From: "Bill Triffet" Subject: Re: [CANSLIM] stocks Yum! Just finished a big ol' slice of humble pie. (g) I just sold ADVP. I had bought it premature on the 9th. I sold it with a 5% loss as my other one IGT was tanking. I didn't like M so I decided to just get out to 100% cash rather than wait for the 7-8% mark. Just shows you what can happen when you A: buy in a bad market and B: when the stock has not formed a good base. IF it pulls back AND we get a follow through, (I can hope eh?) I may look again at this one. - -Bill Triffet - ----- Original Message ----- From: "Patrick Wahl" To: Sent: Saturday, March 24, 2001 8:17 AM Subject: [CANSLIM] stocks > I haven't even been trying to find any stocks for several weeks, but > today I decided to run a scan that looks for new highs. Turned up > one very good chart, ADVP, another that looks pretty good, SFD. > M is still awful, so the risk of buying a breakout is higher than > usual. Still, I guess is says something good about a stock like > ADVP if it can hang at near its high while the market is getting > clocked. > > - > - - ------------------------------ Date: Sat, 24 Mar 2001 09:49:14 -0800 From: "Bill Triffet" Subject: Re: [CANSLIM] DOW 7000? I for one could easily see that mark as one that would finally create the needed fear to settle this market. I still feel this will end in another suckers rally. Still to many folks on the boob tube chanting it's time to get back in techs. - -Bill Triffet - ----- Original Message ----- From: "Dave Rubin" To: Sent: Saturday, March 24, 2001 8:40 AM Subject: RE: [CANSLIM] DOW 7000? > > What is your basis for using such a long timeline? > > No basis really, just happened to see the chart in IBD and the trendline was > clear. > > It's true a lot has changed, but the market also depicts the psychology of > the masses, and that is pretty much a constant. > > That said, I agree that a long-term trend can not predict where the market > will go. As you said, nothing can accurately predict that. Do I expect DOW > to go to 7000? No, but at this point, I wouldn't be shocked either... > > -- > Dave > > > - > - - ------------------------------ Date: Sat, 24 Mar 2001 10:26:44 -0800 (PST) From: Kent Norman Subject: Re: [CANSLIM] DOW 7000? According to "Trader Vic", the trend line should be along the lowest bottoms and the highest highs. He spends a good deal of time bemoaning that most people can't draw a proper trend line. And then there are the moving averages that are also a form of trend line... but this group is not about that, is it? Let's get back to the main issue. Regards Kent Norman - --- walter nusbaum wrote: > > Dave, > > > > What is your basis for using such a long timeline? > (Snip) > > Tom Worley > > stkguru@netside.net > > ICQ # 5568838 > > > > > > ----- Original Message ----- > > From: Dave Rubin > > To: > > Sent: Friday, March 23, 2001 10:20 AM > > Subject: [CANSLIM] DOW 7000? > > > > > > Did anyone else look at the chart of the DOW on > page 1 of IBD and > > come to > > the scary realization that the DOW is still very > much extended on > > a > > long-term basis? > > > > Drawing a long-term trendline from 1987 comes to > around 7000 now. > > Dave, > In Thomas DeMark's, "The New Science of Technical > Analysis", he notes that > the drawing of trend lines is a highly arbitrary > process, and that the trend > line that provides the best fit is truly in the eye > of the beholder. Demark > recognizes that in order for a trend line to be > defined precisely and > unambiguously, it must be based on exactly two > points, and that contrary to > popular convention, trend lines should be drawn from > right to left because > recent price activity is more significant than > historical movement. > > So, according to Demark and using his right to left > approach, perhaps the > best that can be said of the IBD chart is that the > DOW can be presently > viewed as being in a down trend. 'Course, that > depends on the "eye of the > beholder". ;) > Best wishes, > Walt > > > > > - > __________________________________________________ Do You Yahoo!? Get email at your own domain with Yahoo! Mail. http://personal.mail.yahoo.com/ - - ------------------------------ End of canslim-digest V2 #1227 ****************************** To unsubscribe to canslim-digest, send an email to "majordomo@xmission.com" with "unsubscribe canslim-digest" in the body of the message. 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