From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #1935 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 Wednesday, December 12 2001 Volume 02 : Number 1935 In this issue: [CANSLIM] clarification Re: [CANSLIM] Filter Criteria Re: [CANSLIM] ALLY Re: [CANSLIM] breakouts - return to base AW: [CANSLIM] clarification Re: [CANSLIM] stacking the odds in my favor-buying before the pivot point ---------------------------------------------------------------------- Date: Tue, 11 Dec 2001 22:02:39 -0800 From: larry l worden Subject: [CANSLIM] clarification Thanks Tom and Katherien I looked at DGO last week, expensive. I read HTMMIS and get IBD paper and web sight. I am having trouble with BO. I am getting stopped out more than 50%. thanks again I think I have the terms right. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Wed, 12 Dec 2001 01:04:12 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] Filter Criteria This is a multi-part message in MIME format. - ------=_NextPart_000_0048_01C182A8.E98AF840 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Hi Dave, I am not sure if I qualify as an "expert" by your definitions, since I = regularly commit many CANSLIM sins, but I've made money in this most = difficult year, so will comment on my screening / initial selection = criteria. Because of "M" for the past 18 or more months now, I have become more = flexible and have very little in the way of "hard" criteria, I will look = at most any stock that falls into my screening criteria, which is = relatively broad. =20 My daily lists are taken from stocks that made new highs, and are less = than $18.50 in price, market cap under $500 million, and volume that day = under several hundred thousand shares My preference is for stocks with high (over 90) RS, and with a good EPS = ranking, again a preference of over 70 I will consider stocks with EPS ranking down even into the below 50 = range, but the further below 80 it falls, the more it must show me in = future potential. I must have a basis for believing that this ranking = will be improving over the next year or two. I do require that the company be profitable, and for at least the last = two quarters I prefer a stock with no institutional / funds ownership to one with 10% = or more (I like to buy them before the elephants trample them) Sequential actual earnings and sales are more important to me than year = to year percentage increases. If last year was a very weak year, it's = easy to generate easy percentage comparisons this year, and hard to do = the same next year if they are not still growing sequentially. Besides, = sequential growth is easier to set my own expectations than some = faceless analyst. Group RS does not figure into my evaluation, altho this may be a larger = factor in the future if I can chart group performance. But in a large = group, a number of weak performers can still obscure the strength of a = few starting to lead the group higher. Where an earnings forecast is presented, I want it to be 30% or higher, = preferably much higher I am selective in the industries I will consider, sticking to something = I can understand and trust (to at least some degree) Naturally, I want to see a good chart pattern, some kind of basing = formation, or a flat line base. Tom Worley stkguru@netside.net AIM: TexWorley ----- Original Message -----=20 From: Dave=20 To: canslim@lists.xmission.com=20 Sent: Tuesday, December 11, 2001 6:33 PM Subject: [CANSLIM] Filter Criteria Out of all the WON selection criteria what do you all use as "hard" = criteria (hurdles the stock must meet to make your list) versus "soft" = criteria (hurdles that the stock hasn't made but you can rationalize). = I need some consistent method to keep my list at reasonable levels and = am looking to the experts as to what they use. Thanks in advance for your advice - ------=_NextPart_000_0048_01C182A8.E98AF840 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Hi Dave,
 
I am not sure if I qualify as an "expert" by your = definitions,=20 since I regularly commit many CANSLIM sins, but I've made money in this = most=20 difficult year, so will comment on my screening / initial selection=20 criteria.
 
Because of "M" for the past 18 or more months now, I = have=20 become more flexible and have very little in the way of "hard" criteria, = I will=20 look at most any stock that falls into my screening criteria, which is=20 relatively broad. 
 
My daily lists are taken from stocks that made new = highs, and=20 are less than $18.50 in price, market cap under $500 million, and volume = that=20 day under several hundred thousand shares
 
My preference is for stocks with high (over 90) RS, = and with a=20 good EPS ranking, again a preference of over 70
 
I will consider stocks with EPS ranking down even = into the=20 below 50 range, but the further below 80 it falls, the more it must show = me in=20 future potential. I must have a basis for believing that this ranking = will be=20 improving over the next year or two.
 
I do require that the company be profitable, and for = at least=20 the last two quarters
 
I prefer a stock with no institutional / funds = ownership to=20 one with 10% or more (I like to buy them before the elephants trample=20 them)
 
Sequential actual earnings and sales are more = important to me=20 than year to year percentage increases. If last year was a very weak = year, it's=20 easy to generate easy percentage comparisons this year, and hard to do = the same=20 next year if they are not still growing sequentially. Besides, = sequential growth=20 is easier to set my own expectations than some faceless = analyst.
 
Group RS does not figure into my evaluation, altho = this may be=20 a larger factor in the future if I can chart group performance. But in a = large=20 group, a number of weak performers can still obscure the strength of a = few=20 starting to lead the group higher.
 
Where an earnings forecast is presented, I want it = to be 30%=20 or higher, preferably much higher
 
I am selective in the industries I will consider, = sticking to=20 something I can understand and trust (to at least some = degree)
 
Naturally, I want to see a good chart pattern, some = kind of=20 basing formation, or a flat line base.
 
Tom Worley
stkguru@netside.net
AIM:=20 TexWorley
----- Original Message -----
From:=20 Dave
To: canslim@lists.xmission.com =
Sent: Tuesday, December 11, = 2001 6:33=20 PM
Subject: [CANSLIM] Filter = Criteria

Out of all the WON selection criteria = what do you=20 all use as "hard" criteria (hurdles the stock must meet to make your = list)=20 versus "soft" criteria (hurdles that the stock hasn't made but you can = rationalize).  I need some consistent method to keep my list at=20 reasonable levels and am looking to the experts as to what they=20 use.
 
Thanks in advance for your=20 advice
- ------=_NextPart_000_0048_01C182A8.E98AF840-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Wed, 12 Dec 2001 01:11:30 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] ALLY This is a multi-part message in MIME format. - ------=_NextPart_000_0053_01C182A9.EE904240 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Tim, By end of day, CACI trading range (both hi and low) were below = yesterday. And even tho it closed up a little, volume was down, and well = under ADV.=20 Second thoughts at this point, in hindsight? Is it topping out short = term? On INTV, serious damage on nearly 9X ADV, any reason? A serious "tail" = in Katherine's terms. I have noticed a number of other telecom stocks = with negative earnings forecasts for year 2002, surprising given the = weak earnings results in 2001. Is there something fundamental going on = in the industry with respect to the upcoming year? Tom Worley stkguru@netside.net AIM: TexWorley ----- Original Message -----=20 From: Tim Fisher=20 To: canslim@lists.xmission.com=20 Sent: Tuesday, December 11, 2001 11:48 AM Subject: [CANSLIM] ALLY=20 B/O this AM. Also CACI looking good altho this one is extended. Discl: = I=20 own both. INTV: toilet-bound. Tim Fisher Ore-ROCK-On Rockhounding Web Site Pacific Fishery Biologists Information mailto:tim@OreRockOn.com WWW http://OreRockOn.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. - ------=_NextPart_000_0053_01C182A9.EE904240 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Tim,
 
By end of day, CACI trading range (both hi and low) = were below=20 yesterday. And even tho it closed up a little, volume was down, and well = under=20 ADV.
 
Second thoughts at this point, in hindsight? Is it = topping out=20 short term?
 
On INTV, serious damage on nearly 9X ADV, any = reason? A=20 serious "tail" in Katherine's terms. I have noticed a number of other = telecom=20 stocks with negative earnings forecasts for year 2002, surprising given = the weak=20 earnings results in 2001. Is there something fundamental going on in the = industry with respect to the upcoming year?
 
Tom Worley
stkguru@netside.net
AIM:=20 TexWorley
----- Original Message -----
From:=20 Tim = Fisher=20
To: canslim@lists.xmission.com =
Sent: Tuesday, December 11, = 2001 11:48=20 AM
Subject: [CANSLIM] ALLY

B/O this AM. Also CACI looking good altho this one is = extended.=20 Discl: I
own both. INTV: toilet-bound.

Tim = Fisher
Ore-ROCK-On=20 Rockhounding Web Site
Pacific Fishery Biologists Information
mailto:tim@OreRockOn.com
WWW = http://OreRockOn.com


-
-T= o=20 subscribe/unsubscribe, email "majordomo@xmission.com"
-In= the=20 email body, write "subscribe canslim" or
-"unsubscribe = canslim".  Do=20 not use quotes in your email.
- ------=_NextPart_000_0053_01C182A9.EE904240-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Wed, 12 Dec 2001 01:21:49 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] breakouts - return to base This is a multi-part message in MIME format. - ------=_NextPart_000_0067_01C182AB.5FA74220 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable That makes at least two lightbulbs clicking on tonight. Pretty soon we = will light up the country! Maybe instead of collaborating on a book, we = should start a newspaper, and respect the words of our members? Sometimes I impress even myself with my "golden words". The part I like = best is the sheep / shearing / slaughter part. Glad my individualized = training so many years ago by O'neil's staffers paid off. Tom Worley stkguru@netside.net AIM: TexWorley ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Tuesday, December 11, 2001 11:23 PM Subject: Re: [CANSLIM] breakouts - return to base Oh my, Tom. That was the best explanation of that guideline I've ever = heard. That bold print in HTMMIS never made a bit of sense. Why the heck = would I sell something at 20% just because it was up 20%? I've been = summarily ignoring it unless there were other signs of failure kicking = in. *Now* I get it! =20 Katherine ----- Original Message -----=20 From: Tom Worley=20 To: canslim@lists.xmission.com=20 Sent: Tuesday, December 11, 2001 11:29 PM Subject: Re: [CANSLIM] breakouts - return to base Hi Chris, In the article that I frustratingly still cannot find, but written = from an interview with Bill O'Neil around circa 1991 or 1992 for the = Registered Rep magazine (a trade journal for stock brokers), he = explained the 20% rule not as an absolute, but rather as a guideline for = newcomers to CANSLIM to teach them "how" to take profits (more than = "when" to take them). In the same article, he spoke of letting your = winners run once you had accumulated some profits, AND learned how to = take profits. Then you were starting to learn "when" to take profits OR = letting your strongest stocks continue to run, as well as hold through = corrections, in order to eventually still own the ones that moved up = several hundred percent. While times certainly have changed since then, and I am commenting = from 10 year old memory, this article and the training by his staff back = then taught me that a gain of 20% was reason to carefully examine a = chart, and be able to articulate why I WAS NOT selling it. In other = words, it was a reason to sell in the absence of more reasons to hold = it, much like Katherine's rubberband rule. It forced a conscious = examination of both the chart, the fundamentals and forecasts, and "M", = and then a conscious, pro-active decision making process (rather than = the complacency of "I am up 20% so I sell" or the "I am up 20% and this = stock will keep rising forever"). For me, that is one of the strengths of CANSLIM. By having some = "rules" and guidelines, it forces a discipline and conscious intelligent = process rather than just being a sheep following the herd, waiting for = the shearing, if not the slaughter. Tom Worley stkguru@netside.net AIM: TexWorley ----- Original Message -----=20 From: Chris Dempsey=20 To: canslim@lists.xmission.com=20 Sent: Monday, December 10, 2001 1:22 PM Subject: RE: [CANSLIM] breakouts - return to base Katherine, David, and All others interested =20 I remember reading that WON says 40% of breakouts return to the = base. I believe it is more than that. I'm not sure that it is 75%, but = it might be. For that reason WON states in his book you must take some = profits when they hit 20%. On one of the IBD tapes they state to profits = in 1/2 of positions reaching 25%. These are because of the high rate of = pull backs. If you don't do this then you are forced to use the rule, = don't let a winner turn into a loser.=20 =20 SCUR appears to be an example of a stock returning/nearly = returning to the base. -----Original Message----- From: owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com]On Behalf Of = camelot.homes@charter.net Sent: Monday, December 10, 2001 9:49 AM To: canslim@lists.xmission.com Subject: Re: [CANSLIM] low volume breakouts hi katherine , thank you so much for this very good information! = when bulkowski states that stocks retrace back to the b/o piont 75% of = the time is he talking about high or low volume breakouts? and where is = the best place to get a copy of his book? david ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Monday, December 10, 2001 5:10 AM Subject: Re: [CANSLIM] low volume breakouts Hi David, =20 The question you ask is a good one. Demanding controlled study = proof of a guideline like this is important, as it makes an underlying = assumption about technical patterns which may or may not trigger a buy. = I pulled out my "Encyclopedia of Chart Patterns" by Thomas Bulkowski to = answer this question. In this book, the author does statistical studies = on chart formation and there is an entire chapter devoted to the C&H. = (pp.135-152). =20 Before I state the author's conclusions, a general overview of = WON's theory as to why volume should be high on the breakout. That is, = you are looking for the point at which demand so outweighs supply that = the price moves up and onward. In my own personal experience, low volume = breakouts seem to fall back more often than not. But these are "odds" = not specifics. SONC is a good example from recent discussions on the = list. Take a look at the daily chart from 10/3 to now. You can see that = SONC tried very hard on several days to break out of its consolidation, = but fell back and eventually gapped down. The low volume B/O's don't = always mean the stock will fail, just that it's not yet ready to move = on. I like to have the odds in my favor, so I'm always willing to wait = until there's proof of the pudding. =20 Back to Bulkowski. In the C&H formation, the failure rate is = 26%. If you wait for an upside breakout, the failure rate falls to 10%. = Stocks retrace back to the B/O point 75% of the time (average time 12 = days). Waiting for the throwback increases the success rate another 1%. = Typical B/O volume is 180% above the prior day and stays high for the = following week. Interestingly, he says removing the high volume B/O = criteria does hurt performance, but only minimally. This is an excellent = chapter on C&H and, based on the statistical evidence, the author makes = other conclusions that lead to particular trading tactics. There are = several additional criteria that WON would require of a stock forming a = C&H and then breaking out, such as rising RS, high group RS, underlying = fundamental characteristics, etc. that are not included in the author's = study. My own conclusions, anecdotally, are that if these other criteria = are met AND you get a high volume B/O, the odds are in your favor. (No = statistical studies to back that up, however!) =20 Katherine =20 =20 ----- Original Message -----=20 From: camelot.homes@charter.net=20 To: canslim@xmission.com=20 Sent: Sunday, December 09, 2001 5:44 PM Subject: [CANSLIM] low volume breakouts how often does a low volume breakout succeed past the pivot = point versus a high volume breakout past the pivot point? david - ------=_NextPart_000_0067_01C182AB.5FA74220 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
That makes at least two lightbulbs clicking on = tonight. Pretty=20 soon we will light up the country! Maybe instead of collaborating on a = book, we=20 should start a newspaper, and respect the words of our = members?
 
Sometimes I impress even myself with my "golden = words". The=20 part I like best is the sheep / shearing / slaughter part. Glad my=20 individualized training so many years ago by O'neil's staffers paid=20 off.
 
Tom Worley
stkguru@netside.net
AIM:=20 TexWorley
----- Original Message -----
From:=20 Katherine=20 Malm
To: canslim@lists.xmission.com =
Sent: Tuesday, December 11, = 2001 11:23=20 PM
Subject: Re: [CANSLIM] = breakouts - return=20 to base

Oh my, Tom. That was the best = explanation of that=20 guideline I've ever heard. That bold print in HTMMIS never made a bit = of=20 sense. Why the heck would I sell something at 20% just because it was = up 20%?=20 I've been summarily ignoring it unless there were other signs of = failure=20 kicking in. *Now* I get it!
 
Katherine
----- Original Message -----
From:=20 Tom=20 Worley
To: canslim@lists.xmission.com =
Sent: Tuesday, December 11, = 2001 11:29=20 PM
Subject: Re: [CANSLIM] = breakouts -=20 return to base

Hi Chris,
 
In the article that I frustratingly still cannot = find, but=20 written from an interview with Bill O'Neil around circa 1991 or 1992 = for the=20 Registered Rep magazine (a trade journal for stock brokers), he = explained=20 the 20% rule not as an absolute, but rather as a guideline for = newcomers to=20 CANSLIM to teach them "how" to take profits (more than "when" to = take them).=20 In the same article, he spoke of letting your winners run once you = had=20 accumulated some profits, AND learned how to take profits. Then = you=20 were starting to learn "when" to take profits OR letting your = strongest=20 stocks continue to run, as well as hold through corrections, in = order to=20 eventually still own the ones that moved up several hundred=20 percent.
 
While times certainly have changed since then, = and I am=20 commenting from 10 year old memory, this article and the training by = his=20 staff back then taught me that a gain of 20% was reason to carefully = examine=20 a chart, and be able to articulate why I WAS NOT selling it. In = other words,=20 it was a reason to sell in the absence of more reasons to hold it, = much like=20 Katherine's rubberband rule. It forced a conscious examination of = both the=20 chart, the fundamentals and forecasts, and "M", and then a = conscious,=20 pro-active decision making process (rather than the complacency of = "I am up=20 20% so I sell" or the "I am up 20% and this stock will keep rising=20 forever").
 
For me, that is one of the strengths of CANSLIM. = By having=20 some "rules" and guidelines, it forces a discipline and conscious=20 intelligent process rather than just being a sheep following the = herd,=20 waiting for the shearing, if not the slaughter.
 
Tom Worley
stkguru@netside.net
AIM:=20 TexWorley
----- Original Message ----- =
From:=20 Chris Dempsey
To: canslim@lists.xmission.com =
Sent: Monday, December 10, = 2001 1:22=20 PM
Subject: RE: [CANSLIM] = breakouts -=20 return to base

Katherine, David, and All others=20 interested
 
I remember reading that WON says 40% of = breakouts=20 return to the base. I believe it is more than that. I'm not sure = that it=20 is 75%, but it might be. For that reason WON states in his book = you must=20 take some profits when they hit 20%. On one of the IBD tapes they = state to=20 profits in 1/2 of positions reaching 25%. These are because of the = high=20 rate of pull backs. If you don't do this then you are forced to = use the=20 rule, don't let a winner turn into a loser.
 
SCUR appears to be an example of a = stock=20 returning/nearly returning to the base.
-----Original Message-----
From:=20 owner-canslim@lists.xmission.com=20 [mailto:owner-canslim@lists.xmission.com]On Behalf Of=20 camelot.homes@charter.net
Sent: Monday, December = 10, 2001=20 9:49 AM
To: = canslim@lists.xmission.com
Subject: Re:=20 [CANSLIM] low volume breakouts

hi katherine , thank you so = much for this=20 very good information! when bulkowski states that stocks retrace = back to=20 the b/o piont 75% of the time is he talking about high or low = volume=20 breakouts? and where is the best place to get a copy of his = book?=20 david
----- Original Message ----- =
From:=20 Katherine Malm
To: canslim@lists.xmission.com
Sent: Monday, December = 10, 2001=20 5:10 AM
Subject: Re: [CANSLIM] = low volume=20 breakouts

Hi David,
 
The question you ask is a = good one.=20 Demanding controlled study proof of a guideline like this is=20 important, as it makes an underlying assumption about = technical=20 patterns which may or may not trigger a buy. I pulled out my=20 "Encyclopedia of Chart Patterns" by Thomas Bulkowski to answer = this=20 question. In this book, the author does statistical studies on = chart=20 formation and there is an entire chapter devoted to the = C&H.=20 (pp.135-152).
 
Before I state the author's = conclusions,=20 a general overview of WON's theory as to why volume should be = high on=20 the breakout. That is, you are looking for the point at which = demand=20 so outweighs supply that the price moves up and onward. In my = own=20 personal experience, low volume breakouts seem to fall back = more often=20 than not. But these are "odds" not specifics. SONC is a = good=20 example from recent discussions on the list. Take a look at = the daily=20 chart from 10/3 to now. You can see that SONC tried very hard = on=20 several days to break out of its consolidation, but fell back = and=20 eventually gapped down. The low volume B/O's don't always mean = the=20 stock will fail, just that it's not yet ready to move on. I = like to=20 have the odds in my favor, so I'm always willing to wait until = there's=20 proof of the pudding.
 
Back to Bulkowski. In the = C&H=20 formation, the failure rate is 26%. If you wait for an upside=20 breakout, the failure rate falls to 10%. Stocks retrace back = to the=20 B/O point 75% of the time (average time 12 days). Waiting for = the=20 throwback increases the success rate another 1%. Typical B/O = volume is=20 180% above the prior day and stays high for the following = week.=20 Interestingly, he says removing the high volume B/O criteria = does hurt=20 performance, but only minimally. This is an excellent chapter = on=20 C&H and, based on the statistical evidence,  the = author makes=20 other conclusions that lead to particular trading tactics. = There are=20 several additional criteria that WON would require of a stock = forming=20 a C&H and then breaking out, such as rising RS, high group = RS,=20 underlying fundamental characteristics, etc. that are not = included in=20 the author's study. My own conclusions, anecdotally, are that = if these=20 other criteria are met AND you get a high volume B/O, the odds = are in=20 your favor. (No statistical studies to back that up,=20 however!)
 
Katherine
 
 
----- Original Message -----
From:=20 camelot.homes@charter.net
To: canslim@xmission.com
Sent: Sunday, = December 09, 2001=20 5:44 PM
Subject: [CANSLIM] = low volume=20 breakouts

how often does a low volume = breakout=20 succeed  past the pivot point versus  a high = volume=20 breakout past the pivot point?=20 = david
- ------=_NextPart_000_0067_01C182AB.5FA74220-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Wed, 12 Dec 2001 12:27:08 +0100 From: Andreas Himmelreich Subject: AW: [CANSLIM] clarification same happens to me this and last week (DFXI --> darn, miscalculated my SL, I put in 29.60 instead of 29.06 got kicked out yesterday, and DYII SL @ 21). Still working on it too, but I am still positive ... With my old methods, I would have been making more money the last weeks, but I think CANSLIM has a bigger potential (if I will ever get it right). I got to tell my two friends (that chipped in their smal savings) that 2001 will not be positive (though not breathtaking negative as well) and 2002 might be a learning year as well. Whenever I extended or changed my strategy that happend to me (starting with blue chips going to small cap fundamental approach in new markets like NASDAQ or "Neuer Markt" in Germany, going to canslim). Hope that it pays soon ... > -----Ursprungliche Nachricht----- > Von: larry l worden [SMTP:worden33@juno.com] > Gesendet am: Wednesday, December 12, 2001 7:03 AM > An: canslim@lists.xmission.com > Betreff: [CANSLIM] clarification > > Thanks Tom and Katherien > I looked at DGO last week, expensive. I read HTMMIS and get IBD paper > and web sight. I am having trouble with BO. I am getting stopped out more > than 50%. thanks again I think I have the terms right. > > - > -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. ------------------------------ Date: Wed, 12 Dec 2001 06:14:50 -0600 From: "Katherine Malm" Subject: Re: [CANSLIM] stacking the odds in my favor-buying before the pivot point This is a multi-part message in MIME format. - ------=_NextPart_000_039E_01C182D4.4E837440 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Hi David, I see there hasn't yet been a response to your questions. I was sure = this one would draw some discussion. As I don't know your own level of experience with CANSLIM and investing, = I thought I'd answer this from a more generic point of view. (1) The idea behind waiting for a good stock to form a solid base and = then break out on volume is to identify that magical point at which = Demand outstrips Supply and Price is pushed higher--essentially the old = Supply/Demand curve from economics class. Assuming the lion's share of = sellers have been exhausted and the stock is one that people would wish = to own, the theory is that any additional demand for the stock will push = the price further. In order for the Price to continue on, the underlying = fundamentals that create value in the company have got to be sound. So = from this point of view, waiting for the B/O is stacking the odds in = your favor. (2) The statistics on B/O's from various technical formations can be = measured, but as you notice in our discussion the other day, the studies = we were looking at in Bulkowski's book make no preselection based on = fundamentals, as CANSLIM forces us to do. Even still, there are still = odds that B/O's will fail. It's just the way it is. (3) If you are extremely practiced and confident in CANSLIM candidate = selection and can build a sound argument for the company and its = potential, it is possible to make an early entry. Afterall, *some*body = is buying it on the right side of the cup. Even still, it is less risky = if the entry comes on a major change in trend or at a point that is very = near substantial recent support. I'm not advocating this, I think even = the best of the best get whacked when they try to do this. But more = importantly, I don't believe that anyone who hasn't established a long = running track record of successful selection should do this at all. Just = way too risky. Katherine - ----- Original Message -----=20 From: camelot.homes@charter.net=20 To: canslim@lists.xmission.com=20 Sent: Tuesday, December 11, 2001 6:31 PM Subject: [CANSLIM] stacking the odds in my favor-buying before the = pivot point one thing that might increase ones odds-is buying before the pivot = point is reach, if the stock has hugh volume, great technicals and = fundamentals. what do you all think??? david and also do any of you buy before the pivot point , if the volume is hugh, and the technicals and the fundamentals are excellent, and the stock = is setting up to break out of a nice base pattern??? - ------=_NextPart_000_039E_01C182D4.4E837440 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Hi David,
 
I see there hasn't yet been a response = to your=20 questions. I was sure this one would draw some discussion.
 
As I don't know your own level of = experience with=20 CANSLIM and investing, I thought I'd answer this from a more generic = point of=20 view.
 
(1) The idea behind waiting for a good = stock to=20 form a solid base and then break out on volume is to identify that = magical point=20 at which Demand outstrips Supply and Price is pushed higher--essentially = the=20 old Supply/Demand curve from economics class.  Assuming = the=20 lion's share of  sellers have been exhausted and the stock is = one that=20 people would wish to own, the theory is that any additional demand for = the stock=20 will push the price further. In order for the Price to continue on, the=20 underlying fundamentals that create value in the company have got to be = sound.=20 So from this point of view, waiting for the B/O is stacking the odds in = your=20 favor.
 
(2) The statistics on B/O's from = various technical=20 formations can be measured, but as you notice in our discussion the = other=20 day, the studies we were looking at in Bulkowski's book make no = preselection=20 based on fundamentals, as CANSLIM forces us to do. Even still, there are = still=20 odds that B/O's will fail. It's just the way it is.
 
(3) If you are extremely practiced and = confident in=20 CANSLIM candidate selection and can build a sound argument for the = company and=20 its potential, it is possible to make an early entry. Afterall, = *some*body is=20 buying it on the right side of the cup. Even still, it is less risky if = the=20 entry comes on a major change in trend or at a point that is very near=20 substantial recent support. I'm not advocating this, I think even the = best of=20 the best get whacked when they try to do this. But more importantly, I = don't=20 believe that anyone who hasn't established a long running track record = of=20 successful selection should do this at all. Just way too = risky.
 
Katherine
 
----- Original Message -----
From:=20 camelot.homes@charter.net =
Sent: Tuesday, December 11, = 2001 6:31=20 PM
Subject: [CANSLIM] stacking the = odds in=20 my favor-buying before the pivot point

one thing that might increase ones = odds-is buying=20 before the pivot point is reach, if the stock has hugh volume, great=20 technicals and fundamentals. what do you all think??? = david
 
and also
 
do any of you buy before the pivot point , if  the volume is = hugh,
and the technicals and the fundamentals are excellent, and = the stock=20 is
setting up to break out of a nice base=20 pattern???
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