From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #613 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 Friday, May 28 1999 Volume 02 : Number 613 In this issue: Re: [CANSLIM] Shorting stocks [CANSLIM] Re: Shorting Stocks/Puts Re: [CANSLIM] On "M" and corrections/rotations Re: [CANSLIM] On "M" and corrections/rotations Re: [CANSLIM] On "M" and corrections/rotations Pitbull (was Re: [CANSLIM] Re: Shorting Stocks/Puts) [CANSLIM] Cyclicals and Talking Heads ---------------------------------------------------------------------- Date: Thu, 27 May 1999 11:09:59 -0700 From: "Peter Newell" Subject: Re: [CANSLIM] Shorting stocks I like to short new highs that fail, ie down next day on higher volume and look climatic like MVIS SFP, FSA why I know where my stop is a new high. Also, ROST looks interesting. What I'd be real careful about is something like TAGS it almost to the prior base and could bounce. Peter Newell - - ------------------------------ Date: Thu, 27 May 1999 09:17:12 -0800 From: Bill Ford Subject: [CANSLIM] Re: Shorting Stocks/Puts We use a mechanical shorting system that uses some of the canslim rankings to identify stocks that have climbed 400% or more over the last 52 weeks and are beginning to fail. This system works in bull or bear markets. Read more at the address below: http://www.pitbull.com - - ------------------------------ Date: Thu, 27 May 1999 15:34:20 -0400 From: Walter Stock Subject: Re: [CANSLIM] On "M" and corrections/rotations >The long awaited "correction" or "bursting of the bubble" of >the internut stocks is finally occurring, much to the relief >of their shorters. Hi Tom, Agree that a correction in the Nets is occurring. Unfortunately for those who tried to make a living shorting the Net stocks over the last two years, well, many of them are now "pursuing other career opportunities" as they say. I think that a lot of the selling in the Nets was from longs locking in their profits as opposed to short-selling. I know I locked in several weeks ago when I sold my DCLK. Shorting the Net is still a very dangerous business as yesterday's quick rally showed. I think the key is with the new Internet IPO's however. Yesterday five Internet IPO's took place. Two closed higher. The shock is that one Net IPO closed essentially unchanged, and that two more closed lower : Juno Online Services (JWEB:Nasdaq) a low-cost Internet service provider with free email, closed down 10.6%, at 11 5/8, and ZipLink (ZIPL:Nasdaq) closed down 11.6%, at 12 3/8. This is a disaster for those two stocks... they are "broken" IPO's in Wall Street parlance.. Most broken IPO's take a year or more to recover back to their offering price, and many don't recover at all - ever. This will give pause to the many IPO's still in the pipeline, and hopefully stop many of the poorer ones from coming to market. One of the biggest problems in the Internet sector in the last quarter has been the absolute flood of new offerings, and frankly the quality of many has gone from bad to worse. The challenge here if you are a Net investor (as I am) is to sort the wheat from the chaff. In other words to separate the good Net companies that have a chance to grow into their valuations over the next five-ten years, from the other Net companies which are headed for the scrap heap. How do you do this? Well, the canslim ratings are a good screen. Then do a lot of fundamental research. Next, realize that these stocks will probably not have leisurely cup and handle formations, so you will have to look at other kinds of technical analysis to help with timing. Finally, realize that you are buying an infant stock that is going to have very big stumbles along the way. Personally, my own trading accounts are 100% cash right now. When will I start buying in again? Only when the rest of the market has moved lower, and when bull sentiment numbers come back to reality. Walter Stock Oakville, ONT, Canada - - ------------------------------ Date: Fri, 28 May 1999 03:13:54 GMT From: musicant@pacbell.net (Dan Musicant) Subject: Re: [CANSLIM] On "M" and corrections/rotations On Thu, 27 May 1999 15:34:20 -0400, you wrote: :>The long awaited "correction" or "bursting of the bubble" of :>the internut stocks is finally occurring, much to the relief :>of their shorters. : :Hi Tom, : :Agree that a correction in the Nets is occurring. :Unfortunately for those who tried to make a living :shorting the Net stocks over the last two years, :well, many of them are now "pursuing other :career opportunities" as they say. : :I think that a lot of the selling in the Nets was from longs :locking in their profits as opposed to short-selling. :I know I locked in several weeks ago when I sold my DCLK. :Shorting the Net is still a very dangerous business :as yesterday's quick rally showed. No kidding. I don't think I have tried shorting the Net stocks yet. Correction, I made a few bucks shorting MSPG at one point. I know that a lot of people have done it and lost their shirts. Still, one could have made a lot of money shorting them lately, as I have ruefully noted. However, your timing would have to be very good, and you would have to be absolutely on your toes. If you had these bases covered, you could do very well indeed. Same is true for any correction and any volatile sector, e.g. the tech stocks in general. : :I think the key is with the new Internet IPO's however. :Yesterday five Internet IPO's took place. :Two closed higher. The shock is that one Net IPO closed :essentially unchanged, and that two more closed lower : :Juno Online Services (JWEB:Nasdaq) a low-cost Internet :service provider with free email, closed down 10.6%, at 11 5/8, :and ZipLink (ZIPL:Nasdaq) closed down 11.6%, at 12 3/8. : :This is a disaster for those two stocks... they are "broken" :IPO's in Wall Street parlance.. :Most broken IPO's take a year or more to recover back to :their offering price, and many don't recover at all - ever. It's bad luck for any Net IPO that came out this week. It is something of a crapshoot, because the IPO's seem to be planned in advance, and it it happens to coincide with a downturn, you get BURNED. : :This will give pause to the many IPO's still in the pipeline, :and hopefully stop many of the poorer ones from :coming to market. :One of the biggest problems in the Internet sector in the last :quarter has been the absolute flood of new offerings, and :frankly the quality of many has gone from bad to worse. IPO's dried up very considerable in the correction over the summer of 1998. : :The challenge here if you are a Net investor (as I am) :is to sort the wheat from the chaff. In other words to separate :the good Net companies that have a chance to grow into their :valuations over the next five-ten years, from the :other Net companies which are headed for the scrap heap. : :How do you do this? Well, the canslim ratings are a good :screen. Then do a lot of fundamental research. Next, :realize that these stocks will probably not have leisurely :cup and handle formations, so you will have to look at other :kinds of technical analysis to help with timing. Finally, realize :that you are buying an infant stock that is going to have :very big stumbles along the way. It's no secret that the strongest Net stocks are AOL, YHOO, AMZN, EBAY, ATHM (perhaps). Of these, only ATHM and AMZN have no profits at this time.=20 : :Personally, my own trading accounts are 100% cash right now. :When will I start buying in again? Only when the rest of the market :has moved lower, and when bull sentiment numbers come back :to reality. : :Walter Stock :Oakville, ONT, Canada I too am 100% cash. I think you can definitely make money daytrading in this environment, but you need those moments of clarity and the patience to let them come to you. Dan - - ------------------------------ Date: Fri, 28 May 1999 01:11:06 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] On "M" and corrections/rotations Walter, I agree, I think the net correction comes from straight selling substantially heavier than net buying (from either shorts covering or from long positions). While there are undoubtedly some shorting going on, these stocks went so far over any rational valuations that I have little doubt many shorters along the way were wiped out. Tom Worley stkguru@netside.net chat with me at ICQ # 5568838 get ICQ software at http://www.icq.com/icqhomepage.html - -----Original Message----- From: Walter Stock To: Canslim Group Date: Thursday, May 27, 1999 3:41 PM Subject: Re: [CANSLIM] On "M" and corrections/rotations >The long awaited "correction" or "bursting of the bubble" of >the internut stocks is finally occurring, much to the relief >of their shorters. Hi Tom, Agree that a correction in the Nets is occurring. Unfortunately for those who tried to make a living shorting the Net stocks over the last two years, well, many of them are now "pursuing other career opportunities" as they say. I think that a lot of the selling in the Nets was from longs locking in their profits as opposed to short-selling. - - ------------------------------ Date: Fri, 28 May 1999 01:33:42 -0400 From: "Tom Worley" Subject: Pitbull (was Re: [CANSLIM] Re: Shorting Stocks/Puts) Bill, I believe you may have previously been asked, if so I will renew the request. Would you please introduce yourself, and tell us what, if any, connection you have with The Pitbull? Also, are you a licensed member of the securities industry? Thanks, Tom Worley stkguru@netside.net chat with me at ICQ # 5568838 get ICQ software at http://www.icq.com/icqhomepage.html - -----Original Message----- From: Bill Ford To: canslim@lists.xmission.com ; canslim-digest@lists.xmission.com Date: Thursday, May 27, 1999 12:24 PM Subject: [CANSLIM] Re: Shorting Stocks/Puts We use a mechanical shorting system that uses some of the canslim rankings to identify stocks that have climbed 400% or more over the last 52 weeks and are beginning to fail. This system works in bull or bear markets. Read more at the address below: http://www.pitbull.com - - - - ------------------------------ Date: Fri, 28 May 1999 16:37:50 -0400 From: Walter Stock Subject: [CANSLIM] Cyclicals and Talking Heads Speaking about bubbles bursting, the cyclicals look to be joining the Nets. If you pull up a weekly chart of the Morgan Stanley Cyclical Index (CYC), you will see that after topping out in the week of May 10-14, that they are now in a nose-dive. Do you remember (back in April) that parade of money managers, institutional gurus, so-called strategists, and various other talking heads on CNBC, and how they crowed about how cyclicals were going to be the hot investment through the rest of this year and into the year 2000? Well it seems that they are not buying them anymore. Seems that their positions were built back in March. Seems that many of them are doing big selling into the recent strength. I wonder what some of these gracious folks will tell us to buy next? I'm sure they will tell us.... In about six weeks. Once they are finished buying it. The cyclicals are non-Canslim almost by definition. Glad I never bought any. If you want to play them, you can look at the technicals. Presently they are rolling over and asking for a quick exit. Walter Stock Oakville, Ontario, Canada - - ------------------------------ End of canslim-digest V2 #613 ***************************** 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.