From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #157 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 Friday, March 20 1998 Volume 02 : Number 157 In this issue: [CANSLIM] Re. Money Flow Re: [CANSLIM] Re. Money Flow Re: [CANSLIM] Examples of Pivot Points on Recent Breakouts Re: [CANSLIM] Re. Money Flow Re: [CANSLIM] Re. Money Flow Re: [CANSLIM] Re. Money Flow Re: [CANSLIM] Re. Money Flow Re: [CANSLIM] TWLB and ANEN Re: [CANSLIM] NASDAQ distribution day Re: [CANSLIM] MS Investor Beta [CANSLIM] Internet withdrawal [CANSLIM] Disclosure Re: [CANSLIM] Examples of Pivot Points on Recent Breakouts Fw: [CANSLIM] NASDAQ distribution day [CANSLIM] MDLK [CANSLIM] "M" (was Full Closing Bell @ 03/20/98) Re: [CANSLIM] Money Flow Overwhelms Funds (was NASDAQ distribution day) RE: [CANSLIM] Re. Money Flow ---------------------------------------------------------------------- Date: Fri, 20 Mar 1998 13:13:20 EST From: JANSI1AUG1 Subject: [CANSLIM] Re. Money Flow Connie, Good morning. Thanks for the speedy reply (Actually, I'm astonished. I wrote it after 1AM Friday, and I received the CanslimDigest reply Friday later in the morning). But Connie, I have a question. Aren't MF and OBV based on the same thing, ie. Volume. Therefore, in everything I've read (eg. Stocks and Commodites mag) they are autocorrelated, so a signal by the both of them is not really as valid as a signal based on price and volume (ie. Doesn't MF/OBV measure the same thing?) How would you answer this? Based on your experience it works. Or is there some sort of scientific/statistical reason for the validity of the MF/OBV- divergence-indicator? jans - - ------------------------------ Date: Fri, 20 Mar 1998 10:36:49 -0800 From: "Bob Jagow" Subject: Re: [CANSLIM] Re. Money Flow Jans,
If by the MF indicator you mean the Chaikin version, sharp divergences occur at gaps, which Chaiken ignores.
Most other 'accum/distr' indicators [available in MetaStock, SuperCharts, etc.] take account of the gap--can use 'true range' to roll your own.
Bob

At 01:13 PM 3/20/98 -0500, you wrote:
>Connie,
>
>=A0=A0=A0=A0 Good morning.
>
>=A0=A0=A0=A0 Thanks for the speedy reply (Actually, I'm astonished.=A0 I= wrote it after
>1AM Friday, and I received the CanslimDigest reply Friday later in the
>morning).
>=A0=A0=A0
>=A0=A0=A0=A0 But Connie, I have a question.=A0 Aren't MF and OBV based= on the same
>thing, ie. Volume.=A0 Therefore, in everything I've read (eg. Stocks and
>Commodites mag) they are autocorrelated, so a signal by the both of them is
>not really as valid as a signal based on price and volume (ie. Doesn't MF/OBV
>measure the same thing?)
>
>=A0=A0=A0=A0 How would you answer this?=A0 Based on your experience it w= orks.=A0 Or is
>there some sort of scientific/statistical reason for the validity of the
>MF/OBV- divergence-indicator?
>
>=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0= =A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0=A0= =A0=A0=A0=A0 jans
>
>-
>
- - ------------------------------ Date: Fri, 20 Mar 1998 15:27:32 -0500 From: Craig Griffin Subject: Re: [CANSLIM] Examples of Pivot Points on Recent Breakouts Chris, Glad you enjoyed the examples. You wrote: >I have a question though, a lot of the examples you used had >short, quick price increases from where the pivot point was. >How long do you hold the examples that you used? > >I was recently listening to a tape (with WON and David Ryan) >that a friend got with his suscription to IBD and I got the >impression that you held until you lost your 7% or hit your >price that you wanted to sell at - no ifs, ands or buts! But >they also were talking about a much longer time frame for >the increases to occur, I think they said 12 to 18 months was >typical. What are the thoughts on this? Selling right is much harder than buying right (but in a sense, if you sold with a profit, you sold right!). First I would refer you to O'Neil's HTMMIS, Chapter 10 on selling. The concepts are pretty much all there although there is not much in the way of examples and details. There are as many selling approaches as there are Canslim'rs. In general, 1) sell if you see that your stock is giving sell signals (note the plural). The signals I am referring to are 36 items listed in Chapter 10. Usually you have two or three signs from the list showing up in your stock, although occassionally just one is enough to trigger your sell. 2) sell if the general market turns down (gives sell signals), 25% or 50% of your holdings for each sell signal from the market (review the archives for 100's of posts on reading the market). Begin with your weakest stocks first. 3) sell if your purchase has advanced 20-30% from the pivot. I usually use 25-30% as my target. And if no other sell signal is triggered, simply sell half of your position and hold the other half until other signs appear (ie. #1 or #2 above). This means that you will generally hold a purchase in the neighborhood of weeks or months. I believe that to hold a stock for years is unusual in CANSLIM. However, it can be done. What you must do is adjust your selling rules along the way. Some of the rules O'Neil gives at the end of his list of 36 items seem aimed at folks who have held stocks for longer periods. For instance, he says to sell if the 200dma turns south. Well that means you must have held long past the time when the 50dma was violated and long into a basing period. This means that you would have decided not to follow rules to sell if a stock pulls back more than 12 or 15% from its peak. The only reason you would have done this AND continued to hold the stock long enough for the 200dma to turn south is because you had been in the stock a long time with big profits. Having sat out several bases (pullbacks of 20-30%) along the way, you are perhaps sitting out another one, and the 200dma is telling you the long term trend is changing - so at last you must sell. I have not yet been in this pleasant situation, and instead tend to shoot for 25-30% and out. Best regards, Craig - - ------------------------------ Date: Fri, 20 Mar 1998 15:17:30 -0500 From: Connie Mack Rea Subject: Re: [CANSLIM] Re. Money Flow - --------------7A4D675D7A4FEB3DCB5E2778 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit Jans-- The relationship among price/volume/money is complex. Perhaps Tom would wish to explain the many nuances. The answers lie in economics, psychology, micro-macro float, and how market makers set [and manipulate] prices to increase volume. The easiest way to see that money and volume are only loosely connected is to set your software so that you see the volume and price of every trade. Here you will see how float, minute by minute, is tied to price and volume. What no one knows, not even the market maker, is the exact float. One reason why a trader may not want to put in a stop is that he is, in a sense, revealing a part of the float [how much stock is available to buy and sale] and doesn't want his order to be seen. This is the micro-float as opposed to a macro-float of any time period. Tom had asked me to take a look at EPIQ. One day I examined every sale. I commented to him what the tape had looked like to me. E.g., there were sales running from 100 shares to 232,000. That day buyers ran the stock up until they went out for lunch; once the 232,000 block went through, the buyers never came back after lunch. Suppose that the price before and after the 232,000 is the same. What would you conclude? Mathematically, it's a wash, but it may a damn lot matter whether the stock passed into sticky hands or teflon hands. The float will change, depending on whose hands the stock passed into. You can infer how float is related to supply and demand. As I recall, there was only an eighth difference in price before the sale of the big block and flat after. Much money and much volume did nothing to price. If the next sale after the block had been 100 shares at the same price or lower, what would you say is the relation among price/volume/money? What would you have said about price/volume/money before the block, for the block, and after the block? Unless you are a tape reader, you have to work with gross indicators of money and OBV. You may set up BigCharts to see up/down volume. Click Indicators. Go the the top of the list and click Volume+ [Volume and the plus sign]. Select a 5-day screen from the Time window. Select one of the minute intervals [or an hour interval]. Then you see an up/down bar volume in the lower window. You're on your own from there to make an up/down count. You will be able to see what effect up/down volume has on price. Too, as I recall, the NASDAQ used to "double count" volume, a practice different from the NYSE. But I do not think that MF and OBV are "measuring the same thing." Gross volume as indicator is too iffy to be of much use. More useful would be if you could determine OBV on your Canslim breakouts; you will have fewer false breakouts whatever your parameters. Jans, I fear there is much that I have not attended to. Sorry. Connie Mack G1 wrote: > Connie, > > Good morning. > > Thanks for the speedy reply (Actually, I'm astonished. I wrote > it after > 1AM Friday, and I received the CanslimDigest reply Friday later in the > > morning). > > But Connie, I have a question. Aren't MF and OBV based on the > same > thing, ie. Volume. Therefore, in everything I've read (eg. Stocks and > > Commodites mag) they are autocorrelated, so a signal by the both of > them is > not really as valid as a signal based on price and volume (ie. Doesn't > MF/OBV > measure the same thing?) > > How would you answer this? Based on your experience it works. > Or is > there some sort of scientific/statistical reason for the validity of > the > MF/OBV- divergence-indicator? > > jans > > - - --------------7A4D675D7A4FEB3DCB5E2778 Content-Type: text/html; charset=us-ascii Content-Transfer-Encoding: 7bit Jans--

The relationship among price/volume/money is complex. Perhaps Tom would wish to explain the many nuances. The answers lie in economics, psychology, micro-macro float, and how market makers set [and manipulate] prices to increase volume.

The easiest way to see that money and volume are only loosely connected is to set your software so that you see the volume and price of every trade. Here you will see how float, minute by minute, is tied to price and volume. What no one knows, not even the market maker, is the exact float. One reason why a trader may not want to put in a stop is that he is, in a sense, revealing a part of the float [how much stock is available to buy and sale] and doesn't want his order to be seen.

This is the micro-float as opposed to a macro-float of any time period. Tom had asked me to take a look at EPIQ. One day I examined every sale. I commented to him what the tape had looked like to me. E.g., there were sales running from 100 shares to 232,000. That day buyers ran the stock up until they went out for lunch; once the 232,000 block went through, the buyers never came back after lunch.

Suppose that the price before and after the 232,000 is the same. What would you conclude? Mathematically, it's a wash, but it may a damn lot matter whether the stock passed into sticky hands or teflon hands. The float will change, depending on whose hands the stock passed into. You can infer how float is related to supply and demand.

As I recall, there was only an eighth difference in price before the sale of the big block and flat after. Much money and much volume did nothing to price. If the next sale after the block had been 100 shares at the same price or lower, what would you say is the relation among price/volume/money? What would you have said about price/volume/money before the block, for the block, and after the block?

Unless you are a tape reader, you have to work with gross indicators of money and OBV.

You may set up BigCharts to see up/down volume. Click Indicators. Go the the top of the list and click Volume+ [Volume and the plus sign]. Select a 5-day screen from the Time window. Select one of the minute intervals [or an hour interval]. Then you see an up/down bar volume in the lower window. You're on your own from there to make an up/down count.

You will be able to see what effect up/down volume has on price.

Too, as I recall, the NASDAQ used to "double count" volume, a practice different from the NYSE.

But I do not think that MF and OBV are "measuring the same thing." Gross volume as indicator is too iffy to be of much use. More useful would be if you could determine OBV on your Canslim breakouts; you will have fewer false breakouts whatever your parameters.

Jans, I fear there is much that I have not attended to. Sorry.

Connie Mack

G1 wrote:

Connie,
     Good morning.
     Thanks for the speedy reply (Actually, I'm astonished. I wrote it after
1AM Friday, and I received the CanslimDigest reply Friday later in the
morning).
     But Connie, I have a question. Aren't MF and OBV based on the same
thing, ie. Volume. Therefore, in everything I've read (eg. Stocks and
Commodites mag) they are autocorrelated, so a signal by the both of them is
not really as valid as a signal based on price and volume (ie. Doesn't MF/OBV
measure the same thing?)
     How would you answer this? Based on your experience it works. Or is
there some sort of scientific/statistical reason for the validity of the
MF/OBV- divergence-indicator?
                                                      jans
-

- --------------7A4D675D7A4FEB3DCB5E2778-- - - ------------------------------ Date: Fri, 20 Mar 1998 17:44:41 -0500 From: "Frank V. Wolynski" Subject: Re: [CANSLIM] Re. Money Flow At 01:13 PM 3/20/98 EST, JANSI1AUG1 wrote: >Connie, > Good morning. > Thanks for the speedy reply (Actually, I'm astonished. I wrote it after >1AM Friday, and I received the CanslimDigest reply Friday later in the >morning). > But Connie, I have a question. Aren't MF and OBV based on the same >thing, ie. Volume. Therefore, in everything I've read (eg. Stocks and >Commodites mag) they are autocorrelated, so a signal by the both of them is >not really as valid as a signal based on price and volume (ie. Doesn't MF/OBV >measure the same thing?) > How would you answer this? Based on your experience it works. Or is >there some sort of scientific/statistical reason for the validity of the >MF/OBV- divergence-indicator? > > jans > For an exact definition and ample examples, click on the links provided below. The indicators are different and I believe Connie's double screen is a way to have a preponderance of the stocks strength in his favor. From observations I have made, it is an excellent strategy. http://www.equis.com/free/taz/moneyflow.html Money Flow is calculated by multiplying the period's Typical Price by the volume. If today's Typical Price is greater than yesterday's Typical Price, it is considered Positive Money Flow. If today's price is less, it is considered Negative Money Flow. Positive Money Flow is the sum of the Positive Money over the specified number of periods. Negative Money Flow is the sum of the Negative Money over the specified number of periods. http://www.equis.com/free/taz/onbalanvol.html On Balance Volume is a running total of volume. It shows if volume is flowing into or out of a security. When the security closes higher than the previous close, all of the day's volume is considered up-volume. When the security closes lower than the previous close, all of the day's volume is considered down-volume. Frank Wolynski - - ------------------------------ Date: Fri, 20 Mar 1998 17:44:41 -0500 From: "Frank V. Wolynski" Subject: Re: [CANSLIM] Re. Money Flow At 01:13 PM 3/20/98 EST, JANSI1AUG1 wrote: >Connie, > Good morning. > Thanks for the speedy reply (Actually, I'm astonished. I wrote it after >1AM Friday, and I received the CanslimDigest reply Friday later in the >morning). > But Connie, I have a question. Aren't MF and OBV based on the same >thing, ie. Volume. Therefore, in everything I've read (eg. Stocks and >Commodites mag) they are autocorrelated, so a signal by the both of them is >not really as valid as a signal based on price and volume (ie. Doesn't MF/OBV >measure the same thing?) > How would you answer this? Based on your experience it works. Or is >there some sort of scientific/statistical reason for the validity of the >MF/OBV- divergence-indicator? > > jans > For an exact definition and ample examples, click on the links provided below. The indicators are different and I believe Connie's double screen is a way to have a preponderance of the stocks strength in his favor. From observations I have made, it is an excellent strategy. http://www.equis.com/free/taz/moneyflow.html Money Flow is calculated by multiplying the period's Typical Price by the volume. If today's Typical Price is greater than yesterday's Typical Price, it is considered Positive Money Flow. If today's price is less, it is considered Negative Money Flow. Positive Money Flow is the sum of the Positive Money over the specified number of periods. Negative Money Flow is the sum of the Negative Money over the specified number of periods. http://www.equis.com/free/taz/onbalanvol.html On Balance Volume is a running total of volume. It shows if volume is flowing into or out of a security. When the security closes higher than the previous close, all of the day's volume is considered up-volume. When the security closes lower than the previous close, all of the day's volume is considered down-volume. Frank Wolynski - - ------------------------------ Date: Fri, 20 Mar 1998 18:27:06 -0500 From: Joan Sherman Subject: Re: [CANSLIM] Re. Money Flow >At 01:13 PM 3/20/98 EST, JANSI1AUG1 wrote: >>Connie, >> Good morning. >> Thanks for the speedy reply (Actually, I'm astonished. I wrote it after >>1AM Friday, and I received the CanslimDigest reply Friday later in the >>morning). >> But Connie, I have a question. Aren't MF and OBV based on the same >>thing, ie. Volume. Therefore, in everything I've read (eg. Stocks and >>Commodites mag) they are autocorrelated, so a signal by the both of them is >>not really as valid as a signal based on price and volume (ie. Doesn't MF/OBV >>measure the same thing?) >> How would you answer this? Based on your experience it works. Or is >>there some sort of scientific/statistical reason for the validity of the >>MF/OBV- divergence-indicator? >> >> jans >> > >For an exact definition and ample examples, click on the links provided >below. >The indicators are different and I believe Connie's double screen is a way >to have a preponderance of the stocks strength in his favor. >From observations I have made, it is an excellent strategy. > >http://www.equis.com/free/taz/moneyflow.html > >Money Flow is calculated by >multiplying the period's Typical Price by the volume. > >If today's Typical Price is greater than yesterday's Typical >Price, it is considered Positive Money Flow. If today's price is >less, it is considered Negative Money Flow. > >Positive Money Flow is the sum of the Positive Money over the >specified number of periods. Negative Money Flow is the sum >of the Negative Money over the specified number of periods. > > >http://www.equis.com/free/taz/onbalanvol.html > >On Balance Volume is a running total of volume. It shows if >volume is flowing into or out of a security. When the security >closes higher than the previous close, all of the day's volume is >considered up-volume. When the security closes lower than >the previous close, all of the day's volume is considered >down-volume. > > >Frank Wolynski > > >- Canslimmers, et.al. Connie refers to OBV/MF, etc. and also SAR. What is SAR? Joan Sherman /\~~~/\ /\~~~/\ /\~~~/\ /\~/\ /\~/\ and the gang ** ** ** ** ** Support Animal Rescue - - ------------------------------ Date: Fri, 20 Mar 1998 15:20:01 -0800 From: "John Iding" Subject: Re: [CANSLIM] TWLB and ANEN What a wonderful range of opinions ... my thinking with some reinforcement from some on this list is TWLB is very extended .. and due for a correction ... so take profits now ... days activity (limited) confirms ... and for ANEN ... definitely missed original get out point ... but looking at the chart and data for where the stock is now ... it is showing strength ... good pattern ... and could be held with quick trigger (which I don't often have) for additional indication of direction ... so .... we'll see ... John - -----Original Message----- From: John Iding To: canslim@lists.xmission.com Date: Thursday, March 19, 1998 5:55 PM Subject: Re: [CANSLIM] TWLB and ANEN >Thanks to all for the suggestions ... I will be selling TWLB tomorrow and >holding ANEN for a bit longer .... John > > > >- > > - - ------------------------------ Date: Thu, 19 Mar 1998 21:11:11 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] NASDAQ distribution day The requirement that funds must be nearly fully invested as of the end of the qtr comes from their charter when created, which was approved by the SEC. They also must file various reports as of the end of each qtr, which includes among other items, a list of all the stocks they are holding, performance data over the qtr, cost basis for positions held at the end of the qtr. It is from these reports that the institutional holdings of each stock are calculated. This is why institutional holdings accuracy become worse as a qtr goes by. The quarterly "window dressing" has nothing to do with employer withholding. And yes, this same pattern to a greater or lesser degree occurs each qtr. This qtr is a little different, as it looked to me like many funds were hanging onto cash early in the qtr, and only rushed that money into the market very late in the qtr, both to meet the requirement to be invested, as well as chasing this aging bull which took off again without them. The sense I get, however, is that many (most??) of the institutional professionals consider this mkt overdue for a correction, and would prefer to sit on cash, but can't. Thus this "forced" investment has led to heavy buying of the strongest and most liquid stocks. But come April 1, a lot may be withdrawn quickly. They will likely want to be cash rich to handle any wave of redemptions without resorting to selling stocks they want to hold. I know of no "real time" source for accurately assessing mutual funds' current cash position. But it would be interesting to know how close most now are to their required investment percentage. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - -----Original Message----- From: Frank V. Wolynski To: canslim@lists.xmission.com ; canslim@lists.xmission.com Date: Thursday, March 19, 1998 7:24 PM Subject: Re: [CANSLIM] NASDAQ distribution day >At 19:18 3/18/98 -0500, Tom Worley wrote: >>Some quotes I read today: > >...snipped.... > >>Keep in mind that most funds have to be nearly fully invested at the end >of >the qtr... > >...snipped... > >>But by the last week of March, I suspect the flow >>will measurably diminish. Watch the upside volume, I think that will be the >>clue. > >Tom, if I may ask for your indulgence, I'm assuming that this would also be >true of end of June, September, and December. Is that correct? Is this >because of the way withholdings are processed by employers or by the >institutions? >Just curious what the motivation and explanation is for the requirement. > >Thanks, > >Frank Wolynski > > >- > - - ------------------------------ Date: Fri, 20 Mar 1998 17:22:16 -0800 From: "Patrick Wahl" Subject: Re: [CANSLIM] MS Investor Beta > From: "James Adams" > To: "Canslim" > I highly recommend that members of this group take advantage of the beta > version of Microsoft Investor. It is free for 30days at > http://beta.investor.com > The stock screening is awesome with 16000 stocks in the db and the most > incredible number of variables/criteria I've seen anywhere. There are 14-16 > pre-defined screens based on the philosophies of famous analysts such as > Zwieg, O'Shanessy, with such titles as "The Dow Dogs" "Wanger's Growth at a > Reasonable Price Model," etc. Finally got around to signing up today. As an old hand at this site now, have you got an tips for what to use in a screen? (Curious sidelight to this - when I downloaded the software with Netscape 4.0, it needed a plugin, when the browser went to that site to download it, it wasn't found, so I used IE 3.0, which worked fine with no plugins. What a surprise, MSFT designs a site that doesn't quite mesh with with Netscape's browser.) - - ------------------------------ Date: Fri, 20 Mar 1998 20:08:58 -0500 From: "Tom Worley" Subject: [CANSLIM] Internet withdrawal I apologize for my 24 hour absence. My ISP took another hit last night from the storms moving thru our area, and was still down this AM. I suspect, from the small nr of emails I got tonight, that I have missed some of the posts. Will try to hit the archives this weekend, but if anyone sent me something privately, or posted to the group and wanted comments from me, best resend it directly to me (don't repost to the entire group please). tom w - - ------------------------------ Date: Fri, 20 Mar 1998 20:21:00 -0500 From: "Tom Worley" Subject: [CANSLIM] Disclosure Bot HDWY today at 7.875. Again, I'm probably too early, but liked the way it was trading, finished with 2X ADV. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - - ------------------------------ Date: Fri, 20 Mar 1998 20:34:01 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] Examples of Pivot Points on Recent Breakouts Craig, It is possible to get a stock that has made a nice move then goes into a tight base within a very few percentage points of its high. If this lasts long enough, eventually both the 50dma, and then the 200dma, will converge on price. Thus, with a tight base, and esp if vol is drying up, you may not get any signals to sell. However, with the 50 and 200 dma so close, it takes very little selling pressure to violate both dma's. So long as it doesn't violate, I would be inclined to hold, even tho it is not creating addl profits while it bases. The tight, high base, assuming all other CS elements remained strong, would be to me a compelling reason to hold in "hope" of a further volume driven breakout to the upside. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - -----Original Message----- From: Craig Griffin To: canslim@lists.xmission.com Date: Friday, March 20, 1998 3:28 PM Subject: Re: [CANSLIM] Examples of Pivot Points on Recent Breakouts >Chris, > >Glad you enjoyed the examples. > >You wrote: >>I have a question though, a lot of the examples you used had >>short, quick price increases from where the pivot point was. >>How long do you hold the examples that you used? >> >>I was recently listening to a tape (with WON and David Ryan) >>that a friend got with his suscription to IBD and I got the >>impression that you held until you lost your 7% or hit your >>price that you wanted to sell at - no ifs, ands or buts! But >>they also were talking about a much longer time frame for >>the increases to occur, I think they said 12 to 18 months was >>typical. What are the thoughts on this? > > >Selling right is much harder than buying right (but in a sense, if you sold >with a profit, you sold right!). > >First I would refer you to O'Neil's HTMMIS, Chapter 10 on selling. The >concepts are pretty much all there although there is not much in the way of >examples and details. > >There are as many selling approaches as there are Canslim'rs. > >In general, > >1) sell if you see that your stock is giving sell signals (note the >plural). The signals I am referring to are 36 items listed in Chapter 10. >Usually you have two or three signs from the list showing up in your stock, >although occassionally just one is enough to trigger your sell. > >2) sell if the general market turns down (gives sell signals), 25% or 50% >of your holdings for each sell signal from the market (review the archives >for 100's of posts on reading the market). Begin with your weakest stocks >first. > >3) sell if your purchase has advanced 20-30% from the pivot. I usually use >25-30% as my target. And if no other sell signal is triggered, simply sell >half of your position and hold the other half until other signs appear (ie. >#1 or #2 above). > >This means that you will generally hold a purchase in the neighborhood of >weeks or months. I believe that to hold a stock for years is unusual in >CANSLIM. However, it can be done. What you must do is adjust your selling >rules along the way. Some of the rules O'Neil gives at the end of his list >of 36 items seem aimed at folks who have held stocks for longer periods. > >For instance, he says to sell if the 200dma turns south. Well that means >you must have held long past the time when the 50dma was violated and long >into a basing period. This means that you would have decided not to follow >rules to sell if a stock pulls back more than 12 or 15% from its peak. The >only reason you would have done this AND continued to hold the stock long >enough for the 200dma to turn south is because you had been in the stock a >long time with big profits. Having sat out several bases (pullbacks of >20-30%) along the way, you are perhaps sitting out another one, and the >200dma is telling you the long term trend is changing - so at last you must >sell. I have not yet been in this pleasant situation, and instead tend to >shoot for 25-30% and out. > >Best regards, >Craig > >- > - - ------------------------------ Date: Sat, 21 Mar 1998 13:59:35 +1200 From: "Dean Edwards" Subject: Fw: [CANSLIM] NASDAQ distribution day There is an article about the mutual funds playing catch up... http://fnews.yahoo.com/street/view.html the next question to ask, is where they are going to plough this cash. - -----Original Message----- From: Tom Worley To: canslim@lists.xmission.com Date: Saturday, March 21, 1998 1:03 PM Subject: Re: [CANSLIM] NASDAQ distribution day >The requirement that funds must be nearly fully invested as of the end of >the qtr comes from their charter when created, which was approved by the >SEC. - - ------------------------------ Date: Fri, 20 Mar 1998 21:03:31 -0500 From: "Tom Worley" Subject: [CANSLIM] MDLK Up 8.3% today, for once am glad I was too early. Better than 150% of ADV as well. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - - ------------------------------ Date: Fri, 20 Mar 1998 21:20:56 -0500 From: "Tom Worley" Subject: [CANSLIM] "M" (was Full Closing Bell @ 03/20/98) Don't want to sound pessimistic, esp since I went from nearly total cash to almost no buying power left this week, only my 401 remains in cash as of today. But historically, the Monday following triple witching goes the opposite way, and today we closed over 8900 for the first time in history. Wasn't it just yesterday we closed over 8800 for the first time in history, as well? The latest targets from most mkt commentators seem to have been raised from the high 8000, now up around 9300, and all of a sudden that's only 400 pts away, and we are still in March!!! Anyway, this daily recap of today's action from InfoBeat seemed appropos. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - -----Original Message----- From: InfoBeat To: stkguru@netside.net Date: Friday, March 20, 1998 8:36 PM Subject: Finance - Full Closing Bell @ 03/20/98 (1 stories) > MARKET NEWS: The Dow closed above 8900 points for the first time Friday as blue-chips sprinted late session to notch up their third century gain and cap the week's breathtaking record run. The Dow closed up 103 points at 8906, its fifth straight record closed. It was up 304 on the week. The S&P500 index ended up nine points at 1099, a fifth straight record close for that index, as well. Advances led declines by four-to-three in heavy volume of 715 million shares as a triple-witch stirred the cauldron. - - ------------------------------ Date: Fri, 20 Mar 1998 21:33:00 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] Money Flow Overwhelms Funds (was NASDAQ distribution day) Excellent, and to the point, article which I recommend to every investor who is trying to grasp the dynamics of the marketplace. A good overview of the first qtr of 1998, I found nothing to disagree with from my personal observations and readings. I will add that from my personal experience as a broker, prying money out of clients during March is an especially difficult task, there is far too much focus on hoarding cash to pay the tax collector in April. Thus March usually is a dismal month. Not so this year. I haven't yet studied the charts tonight, but I have to believe that NYSE in general, and big caps in particular, are in dangerous territory. Any statements or opinions are strictly my own and not that of my employer. My comments should not be interpreted as a recommendation of any kind. I am a licensed (inactive) broker and an active investor. All investors should do their own research prior to any investment, especially one learned about on the Internet. Hopefully my comments will better inform and educate all investors. tom w - -----Original Message----- From: Dean Edwards To: canslim@lists.xmission.com Date: Friday, March 20, 1998 8:59 PM Subject: Fw: [CANSLIM] NASDAQ distribution day >There is an article about the mutual funds playing catch up... > >http://fnews.yahoo.com/street/view.html > >the next question to ask, is where they are going to plough this cash. > >-----Original Message----- >From: Tom Worley >To: canslim@lists.xmission.com >Date: Saturday, March 21, 1998 1:03 PM >Subject: Re: [CANSLIM] NASDAQ distribution day > > >>The requirement that funds must be nearly fully invested as of the end of >>the qtr comes from their charter when created, which was approved by the >>SEC. > > >- > - - ------------------------------ Date: Fri, 20 Mar 1998 19:06:46 -0800 From: Mike Lucero Subject: RE: [CANSLIM] Re. Money Flow The same equis site has definitions for a slew of indicators. SAR is useful for placing trailing stops. Mike On Friday, March 20, 1998 3:27 PM, Joan Sherman [SMTP:joani@mindspring.com] wrote: > >At 01:13 PM 3/20/98 EST, JANSI1AUG1 wrote: > >>Connie, > >> Good morning. > >> Thanks for the speedy reply (Actually, I'm astonished. I wrote it after > >>1AM Friday, and I received the CanslimDigest reply Friday later in the > >>morning). > >> But Connie, I have a question. Aren't MF and OBV based on the same > >>thing, ie. Volume. Therefore, in everything I've read (eg. Stocks and > >>Commodites mag) they are autocorrelated, so a signal by the both of them is > >>not really as valid as a signal based on price and volume (ie. Doesn't MF/OBV > >>measure the same thing?) > >> How would you answer this? Based on your experience it works. Or is > >>there some sort of scientific/statistical reason for the validity of the > >>MF/OBV- divergence-indicator? > >> > >> jans > >> > > > >For an exact definition and ample examples, click on the links provided > >below. > >The indicators are different and I believe Connie's double screen is a way > >to have a preponderance of the stocks strength in his favor. > >From observations I have made, it is an excellent strategy. > > > >http://www.equis.com/free/taz/moneyflow.html > > > >Money Flow is calculated by > >multiplying the period's Typical Price by the volume. > > > >If today's Typical Price is greater than yesterday's Typical > >Price, it is considered Positive Money Flow. If today's price is > >less, it is considered Negative Money Flow. > > > >Positive Money Flow is the sum of the Positive Money over the > >specified number of periods. Negative Money Flow is the sum > >of the Negative Money over the specified number of periods. > > > > > >http://www.equis.com/free/taz/onbalanvol.html > > > >On Balance Volume is a running total of volume. It shows if > >volume is flowing into or out of a security. When the security > >closes higher than the previous close, all of the day's volume is > >considered up-volume. When the security closes lower than > >the previous close, all of the day's volume is considered > >down-volume. > > > > > >Frank Wolynski > > > > > >- > > Canslimmers, et.al. > Connie refers to OBV/MF, etc. and also SAR. What is SAR? > > > Joan Sherman /\~~~/\ /\~~~/\ /\~~~/\ /\~/\ /\~/\ > and the gang ** ** ** ** ** > Support Animal Rescue > > > > > > > > > - - ------------------------------ End of canslim-digest V2 #157 ***************************** 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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