From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #276 Reply-To: canslim Sender: owner-canslim-digest@lists.xmission.com Errors-To: owner-canslim-digest@lists.xmission.com Precedence: bulk X-No-Archive: yes canslim-digest Monday, June 8 1998 Volume 02 : Number 276 In this issue: [CANSLIM] ADVS positive divergent OBV/MF [CANSLIM] DGO [CANSLIM] Re: Why Newcomers Don' Post [CANSLIM] Surrogates - Db Re: [CANSLIM] Re: O'Neil's Seminar--For Novices (contains TA!) Re: [CANSLIM] Group Stuff - No Stocks Re: [CANSLIM] Group Stuff - No Stocks Re: [CANSLIM] DGO--Rob Re: [CANSLIM] Surrogates - Db Re: [CANSLIM] Surrogates - Db Re: [CANSLIM] Group Stuff - No Stocks Re: [CANSLIM] Re: Why Newcomers Don't Post Re: [CANSLIM] Surrogates - Db Re: [CANSLIM] Surrogates - Db Re: [CANSLIM] Group Stuff - No Stocks [CANSLIM] Medtronic Re: [CANSLIM] ADVS positive divergent OBV/MF Re: [CANSLIM] Group Stuff - No Stocks Re: [CANSLIM] PAYX Double Bottom--TA!!--Craig Re: [CANSLIM] PAYX Double Bottom--TA!!--Newbie Groups ---------------------------------------------------------------------- Date: Sun, 07 Jun 1998 23:23:24 -0500 From: Luke Lang Subject: [CANSLIM] ADVS positive divergent OBV/MF Thanks to Connie for confirming that ADVS might be worth a look. I was only able to find a 5/6/98 copy of IBD that listed ADVS as 92 EPS, 83 RS, and ACC/Dist of A. I think this might be close enough to be considered as CANSLIM. (However, RS may be below 80 by now.??) I hope you find this useful. Luke Lang =========================================================== Morning Luke-- Don't mind the mail at all. Really like the looks of ADVS. The OBV/MF are both strongly and positively divergent. The SloSto and MACD both look good. MACD ought to give a buy on Monday with the first couple of upticks. The SloSto gave a buy on the 3rd. If you will look again, I think that the EMA has given also a second level buy [3-line through the 10-line]. The stock has certainly not got away from you. To me, it looks worth owning a few shares. I might buy a lot, too. If you think that the stock is CS, you should post on it and note that OBV/MF/EMA are also confirming its strength. Or if you don't wish to, I will and note that it is your find. I do need to know if it's CS or near so. Thanks for the mail. Connie Mack Luke Lang wrote: > Connie, > > I hope you don't mind private messages. I'm not sending this to > the CANSLIM group because I don't know if this is CANSLIM related. > It appears to me that ADVS is showing positive divergence. Do you > agree? If so, then it looks like we have a first level buy. With > the current market condition, would you do anything with it? Thanks. > > Best regards, > Luke Lang - - ------------------------------ Date: Mon, 08 Jun 1998 14:07:01 -0400 From: Robert Miller Subject: [CANSLIM] DGO Members: Until last month I had been using DGO and other chart services (i.e. supercharts, quotes plus). I have since stopped using the other services and now subscribe only to DGO. I like DGO very much, but am confused by two things. I have always used log scale graphs and they are mentioned and used some in HTMMIS, but DGO uses arithmetic graphs. Also, the graphs are limited to about 8 months of data, but some of the patterns shown in HTMMIS occur over longer time periods. Maybe I missed something, but is it supposed to be easier to spot price patterns on arithmetic graphs? What do most canslimer's use? Also, are longer patterns considered to be weak, is that why DG doesn't include more data? (i.e. Is a 3 month cup w/handle stronger than a 6 month cup w/handle.) What is the time range that patterns should fall into? Any answers would be greatly appreciated. Thanks Rob Miller - - ------------------------------ Date: Mon, 8 Jun 1998 15:47:12 -0500 (CDT) From: mckeener@ix.netcom.com Subject: [CANSLIM] Re: Why Newcomers Don' Post dpphoenix You wrote "another common reason is the notion that unless one has come up with the stock of the century and developed an analysis that would impress a Harvard MBA, he feels unworthy to participate." That's me!! But I will make the effort to post my thoughts so that maybe even one person can benefit. I see the value. Forget ego, forget what others may think. In the long run, we're here to learn, to prosper and share in our successes and yes, talk about those failures so that we don't repeat them. This board has helped me so much because on the whole, my losses far exceed my gains. This will hurt but I'll say it anyhow. I've lost WHENEVER I DEVIATED FROM CANSLIM, and thought I could do better than O'Neil!! How do you like those apples? THANKS ALL OF YOU!! Regards, Mary Keener - - ------------------------------ Date: Tue, 09 Jun 1998 06:51:15 -0400 From: Jeffry White Subject: [CANSLIM] Surrogates - Db > One thing you might consider is the use of "surrogates" (a Woodward > idea). These surrogate groups are designed to represent the entire > group. Tracking an entire group can often lead you to investigate a > group far too late, particularly if it's a large group. By the time > the group shows up on the radar screen, the leaders are long gone. In > other words, the true leaders are dragging all the laggards behind > them like steamer trunks and the true strength of the group is > disguised. > > These surrogates can be just about anything you want them to be. You > can specify a minimum ADV, a minimum price (though the two often go > together), and leadership quality. By the latter I mean not only > those stocks with high RS, but also those which are widely-respected > and generally considered to be leaders in their group or sector, > though they may not be leaders right at that very moment. > > The use of these smaller groups (say 12 to 15 stocks in each group, if > possible) may enable you to see group moves much sooner, long before > they show up in the IBD rankings. > > - --Db > Last October and into the early winter while sitting in cash, I concluded that Industry Group analysis/tracking/monitoring was a major weakness in my game, but I really didn't know where to start. I was stumbling into oils and chip equipment from May through October, but I missed a ton of stocks which would have served me better had I been more systematic in my approach to Ind. Grps. A kind soul referred me to Woodward's Telescan board on AOL. My wife's account gave me periodic access, but I just never got around to approaching Woodward for his materials on surrogates (I think such thing exists). Also couldn't follow every day, so that just didn't give me the boost I needed. So, I stumbled along through the move that began in January found good stocks in good groups, but without much progress in approaching an analysis of groups. Then, I happened to notice Frank W.'s work on this thread. I understand what he does, but I don't do Excel and not really computer literate, etc. My focus on groups, therefore, has been a manual one (actually not manual at all, since the best I've been able to scratch together is a fairly good visual memory, catch as catch can). Pitiable, at best. Db, Frank, others...any suggestions on how I can try to make a structured approach to the Industry Group component of my efforts? Does Woodward have materials that are available on constructing Surrogates? Does it require Telescan? Should I just breakdown and work with Excel? I would appreciate any assistance. Ignorance at its most profound and dangerous. Thanks, Jeffry - - ------------------------------ Date: Sun, 07 Jun 1998 08:05:30 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] Re: O'Neil's Seminar--For Novices (contains TA!) I received the following from a member of one of the groups I sponsor. Since it echoes many of the sentiments in Mary's post, and since it comes from someone who is "just past" novice, I thought other novices who are struggling with all this might find it interesting. - --Db <> _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Mon, 8 Jun 1998 19:16:38 -0400 From: "bamend" Subject: Re: [CANSLIM] Group Stuff - No Stocks How can you find the stocks that make up a particular group? - -----Original Message----- From: Johan Van Houtven To: canslim@lists.xmission.com Date: Monday, June 08, 1998 12:51 PM Subject: Re: [CANSLIM] Group Stuff - No Stocks >Frank W. wrote: > >>I use the IBD for the actual data. I'm basically cheap and convinced that >>the simpler the tools, the better. I input the data once a week into a >>database that I have customized screens for tracking the data with. > >Frank, > >Alas I can't get IBD here, so I'll have to find some other way to track >groups. > >Do you use the Top 100 Industry Groups list? If so, I could use the same >list from DGO. I've been thinking about using that table. What is holding >me back is that I'll have to learn Excel Visual Basic to do what I want. >And I'd rather learn the QPv2 scanning language first, as that is more >important to me right now. > >>I can't do volume with this particular IBD approach, but have additional >>methods for ascertaining it. I have entertained giving IRL a try, but also >>am a stickler for doing things differently! Besides, again, all the data is >>out there for free. I can't see paying for something I feel I need to put >>together myself to see how it works! This fits nicely with my Engineering >>background. That way I know how it works, when it works, and when and how >>it doesn't! > >That's the best thing to do IMHO. > >My ultimate long term goal is to set up my own groups in QPv2 (when it >becomes available). I.e. doing (almost) everything myself. Becoming as >independant as possible. > >There will be a lot of steps between reaching that goal and where I am now. >But I expect the journey to be as (or even more) satisfying than reaching >the goal. > > > > > > >Johan Van Houtven >CLICK! N.V. / Wilrijk, Belgium > > >- - - ------------------------------ Date: Mon, 08 Jun 1998 20:13:07 -0400 From: "Frank V. Wolynski" Subject: Re: [CANSLIM] Group Stuff - No Stocks At 19:16 6/8/98 -0400, bamend wrote: >How can you find the stocks that make up a particular group? > Alas, I bought the Industry Group Index as advertised in IBD. Before that I was having fairly good success at accumulating the stocks via the free Beta of DGO. It took a while that way. I find the Industry Group Index useful to my study of the Industry groups. You may find it only to be a book full of ticker symbols and names. Before I recommend purchasing it, determine if you truly have the need. The book is organized in three sections. *The first section is alphabetical by industry group. Beneath each group is every stock contained in the group. * The second section is listed alphabetically by company name, then in additional columns, the ticker and IG names. * The third section is arranged alpha by ticker symbol, then following the name and IG. Frank Wolynski - - ------------------------------ Date: Mon, 8 Jun 1998 17:36:44 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] DGO--Rob <> You know the difference between the two, and readers who don't can find an explanation in the book, so I won't go into that here. As to your question, it's probably a matter of personal preference. I understand the concept behind log graphs but I find patterns far easier to detect on an arithmetic graph, particularly if it's weekly. Many cups and handles on my large-scale arithmetic charts practically disappeared on DG (past tense because I dropped it after the beta test was over). But some people love logs and have no trouble with them. <> Depends on the pattern, Rob. A long-term trendline is stronger than an intermediate-term trendline. A long base is stronger than a short one (at least for a CS stock; some non-CS stocks can base for years). But something like a falling flag should resolve itself fairly quickly or else it becomes just another failed breakout. When it comes to cups and handles, the length of time may not be so important as the volume pattern which accompanies the C&H. But even if the volume pattern is there, the cup must be deep enough and wide enough to do its work. Otherwise, it's just a hiccup. O'N, of course, says that handles should be around three weeks long or better. That'll give you some idea of the size of the cup. The dynamic of it just takes time to work out. Perhaps DG doesn't include more data because the charts are so tiny. Don't really know. But you could always use DG data and print out the chart from someplace else. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Mon, 08 Jun 1998 20:42:17 -0400 From: "Frank V. Wolynski" Subject: Re: [CANSLIM] Surrogates - Db At 06:51 6/9/98 -0400, Jeffry White wrote: ...sniped... >So, I stumbled along through the move that began in January found good >stocks in good groups, but without much progress in approaching an >analysis of groups. Then, I happened to notice Frank W.'s work on this >thread. I understand what he does, but I don't do Excel and not really >computer literate, etc. > >My focus on groups, therefore, has been a manual one (actually not >manual at all, since the best I've been able to scratch together is a >fairly good visual memory, catch as catch can). Pitiable, at best. > >Db, Frank, others...any suggestions on how I can try to make a >structured approach to the Industry Group component of my efforts? Does >Woodward have materials that are available on constructing Surrogates? >Does it require Telescan? Should I just breakdown and work with Excel? > >I would appreciate any assistance. Ignorance at its most profound and >dangerous. >Thanks, >Jeffry A Computer is just a tool. Another way of doing something that can be done other ways. I started very simply and since I have computer skills, migrated to spreadsheets, databases, etc... Leave it to an engineer to make it complicated! I digress. Saturdays IBD is Fridays trade data. The software guru's at IBD aren't too sharp, so the rankings are reset every week following Friday. However, they haven't figured how to carry the last weeks ending ranking over. This explains why the Saturdays IBD shows the ranking to be the same last week as it currently is! I puzzled over that for hours, until I realized they reset the current ranking to whatever it currently is at the end of Friday. Thus it is equal. Why is this important? That means that Fridays paper contains an Industry Group table that reflects truly what the ranking was last Friday and how much it has changed in ranking since last Friday! (You are shorted a day, but it is basically not that sensitive.) I used to cut that section out, then sit with a highlighter and mark only the groups making postive ranking changes with an orange or yellow highlighter. Only the positive changes! After a few weeks of that, tell me you don't get a feel for what is going on in the groups! Only takes about 10 minutes and is worth it in my opinion! Save these highlighted group tables in a clear document protector and place it in a 3 ring binder. Write the date at the top of the group table. Worked for me, your mileage may vary. Best Regards, Frank Wolynski - - ------------------------------ Date: Mon, 08 Jun 1998 20:42:17 -0400 From: "Frank V. Wolynski" Subject: Re: [CANSLIM] Surrogates - Db At 06:51 6/9/98 -0400, Jeffry White wrote: ...sniped... >So, I stumbled along through the move that began in January found good >stocks in good groups, but without much progress in approaching an >analysis of groups. Then, I happened to notice Frank W.'s work on this >thread. I understand what he does, but I don't do Excel and not really >computer literate, etc. > >My focus on groups, therefore, has been a manual one (actually not >manual at all, since the best I've been able to scratch together is a >fairly good visual memory, catch as catch can). Pitiable, at best. > >Db, Frank, others...any suggestions on how I can try to make a >structured approach to the Industry Group component of my efforts? Does >Woodward have materials that are available on constructing Surrogates? >Does it require Telescan? Should I just breakdown and work with Excel? > >I would appreciate any assistance. Ignorance at its most profound and >dangerous. >Thanks, >Jeffry A Computer is just a tool. Another way of doing something that can be done other ways. I started very simply and since I have computer skills, migrated to spreadsheets, databases, etc... Leave it to an engineer to make it complicated! I digress. Saturdays IBD is Fridays trade data. The software guru's at IBD aren't too sharp, so the rankings are reset every week following Friday. However, they haven't figured how to carry the last weeks ending ranking over. This explains why the Saturdays IBD shows the ranking to be the same last week as it currently is! I puzzled over that for hours, until I realized they reset the current ranking to whatever it currently is at the end of Friday. Thus it is equal. Why is this important? That means that Fridays paper contains an Industry Group table that reflects truly what the ranking was last Friday and how much it has changed in ranking since last Friday! (You are shorted a day, but it is basically not that sensitive.) I used to cut that section out, then sit with a highlighter and mark only the groups making postive ranking changes with an orange or yellow highlighter. Only the positive changes! After a few weeks of that, tell me you don't get a feel for what is going on in the groups! Only takes about 10 minutes and is worth it in my opinion! Save these highlighted group tables in a clear document protector and place it in a 3 ring binder. Write the date at the top of the group table. Worked for me, your mileage may vary. Best Regards, Frank Wolynski - - ------------------------------ Date: Mon, 8 Jun 1998 17:42:10 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] Group Stuff - No Stocks <> If you have $35 to spend, call IBD at 1-800-815-6300 and ask for their Industry Group and Ticker Symbol Guide. If you don't have $35 to spend, go to the library and look up the Companies In The Spotlight (or whatever they're called). You won't get the complete list of a particular group that way, but you will get the major players, or thereabouts. Only problem is, it'll take a while. Perhaps group members who've been doing that for a while would be willing to post their lists. Or if your library subscribes to DG, you can always look up a particular company to get its group, but you can't look up a group and get its composition. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Mon, 8 Jun 1998 17:19:07 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] Re: Why Newcomers Don't Post <> Good for you, Mary. Nobody here has any interest in making fun of you. What would be the point? And next time you get to feeling bad, ask me to tell you about Cascade International. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Mon, 8 Jun 1998 17:57:22 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] Surrogates - Db Db, Frank, others...any suggestions on how I can try to make a structured approach to the Industry Group component of my efforts? <> That's a tough one, Jeffry. As you know, HGS is based on CS, but Woodward is connected with Telescan, so all the discussions revolve around how HGS, Telescan, and Woodward's new software program--IRL--work together. By the time I became aware of HGS, I'd already been using WOWS for some time and had already done considerable work setting up my groups and creating my group composites. I wasn't about to toss all that and switch to Telescan and Metastock just to take advantage of something that wasn't, IMO, demonstrably better than what I already had. So, no, it doesn't require Telescan, but I don't see how you'd keep track of it all without a program that enables you to create groups and group composites, whether it's something like WOWS or Excel or whatever. Just as with CS, what you want to do first is decide on what criteria you're going to use for the stocks in your groups. I got into this in an earlier post. If you missed it, I may still have it in my Sent file. But you'll probably also want to focus on the most likely groups to outperform as well, what Woodward calls, or used to call, HGS Groups. These are the groups that were most often top-ranked in GS during, I believe, the previous four or five years. There are forty-four of them, which cuts down the amount of work considerably. Remember, however, that while this is based on CS, the two are not identical. There are some groups that O'N might like that aren't included here. Or maybe not. I don't know. Just cautioning you. Remember also that we're talking high-growth strategy here. You won't find GM or MMM here. I can provide you with the current list of groups if you like. As far as what stocks you select for each group, that was covered in the earlier post. Ideally you want no more than 12-15, but with some groups, like Computer Software-Enterprise, that's just not possible. But you try, nonetheless. Keep in mind that you want only the best, and you shouldn't have trouble winnowing it down. Does this give you a place to start? - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Mon, 8 Jun 1998 18:03:35 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] Surrogates - Db <> You can also get a complete list of all groups with their rankings for the past six weeks (or eight?) at the Delphi site, listed either by rank or alphabetically. Then copy and paste to your heart's content. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Mon, 08 Jun 1998 18:07:32 -0700 From: "James B. Andrews" Subject: Re: [CANSLIM] Group Stuff - No Stocks A long time ago the IBD sold the list on a floppy and it sure was handy. Don't know if they still do, but sooner or later someone will buy it, scan it and create that floppy... The probably don't want to sell it on a floppy since it would be so easy to pass around the net... Maybe someone already has done this... don't know.. Jim At 08:13 PM 6/8/98 -0400, you wrote: >At 19:16 6/8/98 -0400, bamend wrote: >>How can you find the stocks that make up a particular group? >> > >Alas, I bought the Industry Group Index as advertised in IBD. Before that I >was having fairly good success at accumulating the stocks via the free Beta >of DGO. It took a while that way. I find the Industry Group Index useful to >my study of the Industry groups. You may find it only to be a book full of >ticker symbols and names. Before I recommend purchasing it, determine if >you truly have the need. > >The book is organized in three sections. >*The first section is alphabetical by industry group. Beneath each group is >every stock contained in the group. >* The second section is listed alphabetically by company name, then in >additional columns, the ticker and IG names. >* The third section is arranged alpha by ticker symbol, then following the >name and IG. > >Frank Wolynski > > >- > - - ------------------------------ Date: Mon, 8 Jun 1998 18:16:22 -0800 From: "Patrick Wahl" Subject: [CANSLIM] Medtronic Someone asked me about Medtronic and unfortunately I've deleted the original post, pretty sure it was Mike someone (ziegler?) I'm somewhat familiar with Medtronic, as a former Minnesotan I have kept half an eye on it for years. It seems to have reached a status somewhat like Coke, GE, MSFT, etc., where it is valued far beyond what would seem to be fair because of the consistency of its earnings. Its hard to argue with the success it has had, but if I look at it from a value basis, it is hard to see a lot of upside for a while. Earnings estimates for MDT are $1.50 this year, $1.77 next year. Thats around 20% year over year, while the PE on this year's earnings is 40. It would seem to need to rest for a while. Just my two cents, don't really know where it will go. Hope that is some help. - - ------------------------------ Date: Mon, 8 Jun 1998 18:23:08 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] ADVS positive divergent OBV/MF <> You're right, Luke. It is below 80. But it is arguably a CS stock, even though the growth may be slowing. The problem is the chart. Unless you're a daytrader and you're willing to bail if the stock can't break through very srong resistance at 39-40, I'd stay away from it until it shows whether it has any muscle or not. If you'd like to estimate just how much muscle it might have, find out if estimates have been raised or if the stock has been upgraded for some reason. Find out when earnings are due and how likely it is the stock will beat estimates. The stock may sail right back to 48 without ever looking back. But if it reverses and heads back toward 33, what are you going to do and when? What will it take for the market to prove you wrong? - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Mon, 08 Jun 1998 21:59:36 -0400 From: "Frank V. Wolynski" Subject: Re: [CANSLIM] Group Stuff - No Stocks I Emailed them about a month ago asking about the availability of the Groups on a floppy, but they responded negatively. It was not available and would not be, legitimately that is. Haven't heard of its priracy either. Frank Wolynski At 18:07 6/8/98 -0700, James B. Andrews wrote: > >A long time ago the IBD sold the list on a floppy and it sure was handy. >Don't know if they still do, but sooner or later someone will buy it, scan >it and create that floppy... The probably don't want to sell it on a floppy >since it would be so easy to pass around the net... > >Maybe someone already has done this... don't know.. > >Jim > > > > > >At 08:13 PM 6/8/98 -0400, you wrote: >>At 19:16 6/8/98 -0400, bamend wrote: >>>How can you find the stocks that make up a particular group? >>> >> >>Alas, I bought the Industry Group Index as advertised in IBD. Before that I >>was having fairly good success at accumulating the stocks via the free Beta >>of DGO. It took a while that way. I find the Industry Group Index useful to >>my study of the Industry groups. You may find it only to be a book full of >>ticker symbols and names. Before I recommend purchasing it, determine if >>you truly have the need. >> >>The book is organized in three sections. >>*The first section is alphabetical by industry group. Beneath each group is >>every stock contained in the group. >>* The second section is listed alphabetically by company name, then in >>additional columns, the ticker and IG names. >>* The third section is arranged alpha by ticker symbol, then following the >>name and IG. >> >>Frank Wolynski >> >> >>- >> > >- > > - - ------------------------------ Date: Mon, 8 Jun 1998 08:59:43 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] PAYX Double Bottom--TA!!--Craig <> In this case, a daily stochastic. But what you do with all of this depends entirely on goals, risk tolerance, timeframe, etc. Which is why a TA formula which works for one individual will be completely inappropriate for another. With PAYX, for example, you have a positive weekly stochastic and RSI and a negative weekly MACD. On a daily chart, the stochastic is at an overbought level, the RSI is rolling over (though not from an overbought level), but the MACD has turned positive. Granted the MACD is useful primarily when the stocks is trending, and PAYX is not yet trending, but if you had bought when the stock reversed itself two weeks ago, you'd have a nice comfort zone and could--if you have an intermediate-term timeframe--just hold onto it and see what happens. But aside from all this TA-babble, I look at the overall pattern. When I enter a stock, I like to have as many of the probabilities on my side as possible. When the occasion presents itself, I personally prefer buying low and selling high rather than buying high and selling higher. But PAYX is stuck in the middle. If it were to retest the low at 33 (which is also near its 200d EMA and a trendline begun in August of last year), I'd have more confidence as to the upside. Barring that, I (again personally) would wait for the new high off 40. As it is, the stock is slightly more than half-way between these two points, making the risk-reward 1:1. I like to see a risk-reward ratio of at least 1:3. If the daily chart is positive and the weekly negative, you may be facing considerable resistance and a shorting opportunity. If the daily chart is negative and the weekly positive, you may be facing an excellent buying opportunity, depending on the volume, the group, and the market. Since there's no clear signal anywhere, the likelihood is that the stock will trade sideways for a while. The landscape changes if the stock holds at the 50d MA. If it then is able to exceed the immediately preceding high at 39, it's less likely that you're looking at a trading range and more likely that you're going to make a run for a new high. But then what? How much juice does the stock have? When are earnings due? What's the whisper number likely to be? This is where the fundamentals come in. Again, if I'm going to buy at the upper end of the range or at or near a new high, I want to make sure I've got plenty of push behind me, which is one of the functions of a nice, long base. Please note that I'm not criticizing Tim's choice, just sounding a note of caution. Downside may be limited to the 50d or it may extend all the way to the preceding low. Volume isn't giving us much help, and we don't have any clues from a base. So chicken me would just wait for the stock to decide which fork it's going to take. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Mon, 8 Jun 1998 12:45:32 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] PAYX Double Bottom--TA!!--Newbie Groups <<>PS. I found the post by one of the folks from another group to be quite >good. Thank you for taking the time to re-post it here. > Is the group private? Frank>> Not in the sense of "exclusive". In fact, most of the members have gone their merry ways. It all started when I was on AOL and I saw how novices were treated on so many message boards, particularly the CS board. There were only a few real jerks. In fact, they may have all been the same person, given that AOL allows up to six alternate screen names. But the net effect was to discourage novices from posting stocks or questions. So I volunteered to organize and sponsor groups of novices. It was generally up to them to decide what the steps were going to be (read the book first!), who was going to do what and when, and so forth. My role was primarily to tell them about websites, answer questions, prevent arguments, toss out jerks (there weren't any), and help them stay focused. Attrition was fairly heavy. Many just wanted to know what CS was all about, but they didn't really want to work that hard. Some were just looking for stock tips. Some wanted to use CS for only a small portion of their portfolios and thought CS would take up a disproportionate amount of time (after all, you have to read a book). Some decided that funds were more to their liking, given that they wanted lives. But quite a few just loved it and really got into it. They're still together, sharing stock ideas and analyzing charts to shreds, but they're hardly newbies anymore. I could sponsor another one, but I really don't see the point. I see no reason why novices or near-novices shouldn't feel comfortable about asking whatever they please of this e-mail group. If some regulars don't want to respond, they don't have to. Or newbie questions could get a subject-line tag, like the "TA" tag that some have asked for, so that those who aren't interested can skip the questions. I for one think that even those who have been using CS for years could stand to reexamine long-held beliefs. They might surprise themselves. Or others. The best way to know whether you really understand something is to find out whether or not you can explain it to someone else. For example, I'm glad that Tom finally responded to Jeffry. Some interesting stuff there. I'm sorry to see the thread closed. My apologies for such a long answer to such a short question, but I've received far more inquiries about "the groups" than I ever expected, and this should take care of whatever anyone might have wanted to know. _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ End of canslim-digest V2 #276 ***************************** To unsubscribe to canslim-digest, send an email to "majordomo@xmission.com" with "unsubscribe canslim-digest" in the body of the message. For information on digests or retrieving files and old messages send "help" to the same address. Do not use quotes in your message.