From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #1910 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 Sunday, December 9 2001 Volume 02 : Number 1910 In this issue: INVN (was Re: [CANSLIM] Non-canslim: Sell Rule spreadsheet and INVN.) Re: [CANSLIM] Whither EPIQ? Re: INVN (was Re: [CANSLIM] Non-canslim: Sell Rule spreadsheet and INVN.) Re: [CANSLIM] Another Question: Beakouts ... Re: [CANSLIM] Another Question: Beakouts ... ---------------------------------------------------------------------- Date: Sun, 9 Dec 2001 06:28:08 -0500 From: "Tom Worley" Subject: INVN (was Re: [CANSLIM] Non-canslim: Sell Rule spreadsheet and INVN.) This is a multi-part message in MIME format. - ------=_NextPart_000_008F_01C1807A.AB40CA40 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Hi Doug, INVN represents another scenario I have been trying to grapple with, = that of the under performer that suddenly comes to life due to a major = external event (September 11 attacks). Logically, from under $5 to over = $30 in several months should suggest a correction, and make your puts = valuable. Likewise, a trailing PE of 446 should give most investors = cause to ponder. On the other hand, the $27 million contract they signed last month = represents a major addition (about 5 months worth of sales) to their = business, depending on how quickly they can deliver. If I were in your = position, I would be doing some extensive due diligence if not already = done. How quickly can they complete and collect on this latest contract? = Do they have other major contracts in negotiation? Are they going to = have extensive ramp up costs to handle this or other contracts? = Management does not have a big stake in this company (14%) so less = likely to be dumping shares at this price. But funds are also not = heavily invested (7% on last qtr) so plenty of room for them to be = buyers, and make this stock explode (sorry for the pun). Tom Worley stkguru@netside.net AIM: TexWorley ----- Original Message -----=20 From: DougC=20 To: canslim@lists.xmission.com=20 Sent: Saturday, December 08, 2001 11:03 PM Subject: [CANSLIM] Non-canslim: Sell Rule spreadsheet and INVN. Hi Katherine Excellent spreadsheet. Thanks for sharing it. I plugged in the values = for the 10 stocks I'm currently long. Makes it very easy to compare the stocks to the = averages and also to each other. I also plugged in the values for a non-canslim stock I'm swimming upstream against. Don't know if you've heard about INVN. It's been in = the news lately because they make an explosion detection system. Since the Sept 11 = attacks everyone has been jumping on the stock because of supposed increased demand = from airports. And last friday the gov apparantly signed some contract with Invn. I = don't know much about the contract but I saw the stock jump 5 points after the = anouncement. I=20 figured it was mostly retail buyers like my co-workers who saw an = article on it=20 in the WSJ so bought it. I looked it up in DGO and saw that invn hasnt = been doing that great over the past four quarters and definitely wouldnt qualify as = CANSLIM. So knowing that and seeing last friday 11/30 that it was already well extended = above the 50dma and 200dma I bought some puts on it. This Friday it kicked me in the head and = shot up 5.89 points. I plugged in the current numbers into your spreadsheet and see that it's = extended 102% above 50dma and 382% above 200dma. DGO shows the PE at 446. This thing has got to = go down. ;(=20 I'm itching to buy more puts but I'm afraid I might get past my = threshold for being able to sleep. =20 At 12:49 PM 12/7/01 -0600, you wrote: Here's a quick Excel spreadsheet for calculating triggers for stocks = you may own. =20 Enter, stock, recent base low, 50 dMA, 100 dMA and current Price. =20 Katherine - ------=_NextPart_000_008F_01C1807A.AB40CA40 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Hi Doug,
 
INVN represents another scenario I have been trying = to grapple=20 with, that of the under performer that suddenly comes to life due to a = major=20 external event (September 11 attacks). Logically, from under $5 to over = $30 in=20 several months should suggest a correction, and make your puts valuable. = Likewise, a trailing PE of 446 should give most investors cause to=20 ponder.
 
On the other hand, the $27 million contract they = signed last=20 month represents a major addition (about 5 months worth of sales) to = their=20 business, depending on how quickly they can deliver. If I were in your = position,=20 I would be doing some extensive due diligence if not already done. How = quickly=20 can they complete and collect on this latest contract? Do they have = other major=20 contracts in negotiation? Are they going to have extensive ramp up costs = to=20 handle this or other contracts? Management does not have a big stake in = this=20 company (14%) so less likely to be dumping shares at this price. But = funds are=20 also not heavily invested (7% on last qtr) so plenty of room for them to = be=20 buyers, and make this stock explode (sorry for the pun).
 
Tom Worley
stkguru@netside.net
AIM:=20 TexWorley
----- Original Message -----
From:=20 DougC =
To: canslim@lists.xmission.com =
Sent: Saturday, December 08, = 2001 11:03=20 PM
Subject: [CANSLIM] Non-canslim: = Sell Rule=20 spreadsheet and INVN.

Hi Katherine

Excellent spreadsheet. Thanks for = sharing=20 it. I plugged in the values for the 10 stocks
I'm currently long. = Makes it=20 very easy to compare the stocks to the averages and also
to each=20 other.

 I also plugged in the values for a  = non-canslim stock=20 I'm swimming
upstream against. Don't know if you've heard about = INVN. It's=20 been in the news lately
because they make an explosion detection = system.=20 Since the Sept 11 attacks everyone
has been jumping on the stock = because of=20 supposed increased demand from airports.
And last friday the gov = apparantly=20 signed some contract with Invn. I don't know much
about the = contract but I=20 saw the stock jump 5 points after the anouncement. I
figured it = was mostly=20 retail buyers like my co-workers who saw an article on it
in the = WSJ so=20 bought it. I looked it up in DGO and saw that invn hasnt been doing=20 that
great over the past four quarters and definitely wouldnt = qualify as=20 CANSLIM. So knowing
that and seeing last friday 11/30  that it = was=20 already well extended above the 50dma and 200dma
I bought some puts = on it.=20 This Friday it kicked me in the head and shot up 5.89 points. I = plugged
in=20 the current numbers into your spreadsheet and see that it's extended = 102%=20 above 50dma
and 382% above 200dma. DGO shows the PE at 446. This = thing has=20 got to go down. ;(
I'm itching to buy more puts but I'm afraid I = might get=20 past my threshold for being able to
sleep. 



At = 12:49=20 PM 12/7/01 -0600, you wrote:
Here's a quick Excel spreadsheet for=20 calculating triggers for stocks you may = own.
 
Enter, stock, recent base low, 50 dMA, 100 dMA = and current=20 Price.
 
Katherine
- ------=_NextPart_000_008F_01C1807A.AB40CA40-- - - - -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: Sun, 9 Dec 2001 06:53:32 -0600 From: "Katherine Malm" Subject: Re: [CANSLIM] Whither EPIQ? This is a multi-part message in MIME format. - ------=_NextPart_000_046D_01C1807E.370CB9A0 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable HI Dave, Welcome. I think you hit the nail on the head. Somehow, being on the = list and focusing on CANSLIM by exchanging ideas seems to reinforce the = discipline. Knowing that other people might be struggling with the same = issues and finding ways to enhance their trading as a result also brings = new energy. Glad you're here! Katherine ----- Original Message -----=20 From: J. David Stem=20 To: canslim@lists.xmission.com=20 Sent: Sunday, December 09, 2001 2:53 AM Subject: Re: [CANSLIM] Whither EPIQ? I'm new to this board and am going to try to post a reply. First of = all, hi from Los Angeles. Secondly, after reading your posts about = EPIQ, I checked out the chart and I have to say, you should be = congratulating yourself on this trade. It's trades like this that show = how well WON's system works. I was making plenty of money two years = ago, as was everyone else, and then one day, bought CMTN after what I = thought was a good cup-n-handle. A day or so later, I was stopped out = after the stock gapped down, straight through my stop loss. I was = annoyed, trying to figure out what I had done wrong. Looking back on = the trade now, I'm grateful for what I did right. I think I got out = around 102. And now the stock trades below 2. =20 In one of the Market Wizards books, one of WON's disciples talks about = how even with the best looking trades, he expects to get stopped out 50% = of the time. =20 I think I'm writing all this not to bolster or convince Warren of = anything, but to remind myself. After doing well with WON's methods, I = decided I knew bests and bought heavily on margin, then refused to sell = at my stop loss points. Hey, the market would come back in agreement = with me, right?? Yeah, right. =20 Anyway, I just wanted to say hi to all on the board and thank you for = your contributions. =20 Thanks, Dave Stem - ------=_NextPart_000_046D_01C1807E.370CB9A0 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
HI Dave,
 
Welcome. I think you hit the nail on = the head.=20 Somehow, being on the list and focusing on CANSLIM by exchanging ideas = seems to=20 reinforce the discipline. Knowing that other people might be struggling = with the=20 same issues and finding ways to enhance their trading as a result also = brings=20 new energy. Glad you're here!
 
Katherine
----- Original Message -----
From:=20 J. = David Stem=20
Sent: Sunday, December 09, 2001 = 2:53=20 AM
Subject: Re: [CANSLIM] Whither=20 EPIQ?

I'm new to this board and am going to = try to post=20 a reply.  First of all, hi from Los Angeles.  Secondly, = after=20 reading your posts about EPIQ, I checked out the chart and I have to = say, you=20 should be congratulating yourself on this trade.  It's trades = like this=20 that show how well WON's system works.  I was making plenty of = money two=20 years ago, as was everyone else, and then one day, bought CMTN after = what I=20 thought was a good cup-n-handle.  A day or so later, I was = stopped out=20 after the stock gapped down, straight through my stop loss.  I = was=20 annoyed, trying to figure out what I had done wrong.  Looking = back on the=20 trade now, I'm grateful for what I did right.  I think I got out = around=20 102.  And now the stock trades below 2. 
 
In one of the Market Wizards books, = one of WON's=20 disciples talks about how even with the best looking trades, he = expects to get=20 stopped out 50% of the time. 
 
I think I'm writing all this not to = bolster or=20 convince Warren of anything, but to remind myself.  After doing = well with=20 WON's methods, I decided I knew bests and bought heavily on margin, = then=20 refused to sell at my stop loss points.  Hey, the market would = come back=20 in agreement with me, right??  Yeah, right. 
 
Anyway, I just wanted to say hi to = all on the=20 board and thank you for your contributions. 
 
Thanks,
 
Dave = Stem
- ------=_NextPart_000_046D_01C1807E.370CB9A0-- - - - -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: Sun, 9 Dec 2001 07:03:30 -0600 From: "Katherine Malm" Subject: Re: INVN (was Re: [CANSLIM] Non-canslim: Sell Rule spreadsheet and INVN.) This is a multi-part message in MIME format. - ------=_NextPart_000_0480_01C1807F.9BD4C8E0 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Tom, >>so plenty of room for them to be buyers, and make this stock explode = (sorry for the pun).<< Thank you for starting my day off on the right foot. I'll be laughing = over this one for hours! Katherine ----- Original Message -----=20 From: Tom Worley=20 To: canslim@lists.xmission.com=20 Sent: Sunday, December 09, 2001 5:28 AM Subject: INVN (was Re: [CANSLIM] Non-canslim: Sell Rule spreadsheet = and INVN.) Hi Doug, INVN represents another scenario I have been trying to grapple with, = that of the under performer that suddenly comes to life due to a major = external event (September 11 attacks). Logically, from under $5 to over = $30 in several months should suggest a correction, and make your puts = valuable. Likewise, a trailing PE of 446 should give most investors = cause to ponder. On the other hand, the $27 million contract they signed last month = represents a major addition (about 5 months worth of sales) to their = business, depending on how quickly they can deliver. If I were in your = position, I would be doing some extensive due diligence if not already = done. How quickly can they complete and collect on this latest contract? = Do they have other major contracts in negotiation? Are they going to = have extensive ramp up costs to handle this or other contracts? = Management does not have a big stake in this company (14%) so less = likely to be dumping shares at this price. But funds are also not = heavily invested (7% on last qtr) so plenty of room for them to be = buyers, and make this stock explode (sorry for the pun). - ------=_NextPart_000_0480_01C1807F.9BD4C8E0 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Tom,
 
>>so plenty of=20 room for them to be buyers, and make this stock explode (sorry for the=20 pun).<<
 
Thank you for starting my day off on the right foot. = I'll be=20 laughing over this one for hours!
 
Katherine
----- Original Message -----
From:=20 Tom = Worley=20
Sent: Sunday, December 09, 2001 = 5:28=20 AM
Subject: INVN (was Re: = [CANSLIM]=20 Non-canslim: Sell Rule spreadsheet and INVN.)

Hi Doug,
 
INVN represents another scenario I have been = trying to=20 grapple with, that of the under performer that suddenly comes to life = due to a=20 major external event (September 11 attacks). Logically, from under $5 = to over=20 $30 in several months should suggest a correction, and make your puts=20 valuable. Likewise, a trailing PE of 446 should give most investors = cause to=20 ponder.
 
On the other hand, the $27 million contract they = signed last=20 month represents a major addition (about 5 months worth of sales) to = their=20 business, depending on how quickly they can deliver. If I were in your = position, I would be doing some extensive due diligence if not already = done.=20 How quickly can they complete and collect on this latest contract? Do = they=20 have other major contracts in negotiation? Are they going to have = extensive=20 ramp up costs to handle this or other contracts? Management does not = have a=20 big stake in this company (14%) so less likely to be dumping shares at = this=20 price. But funds are also not heavily invested (7% on last qtr) so = plenty of=20 room for them to be buyers, and make this stock explode (sorry for the = pun).
 
- ------=_NextPart_000_0480_01C1807F.9BD4C8E0-- - - - -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: Sun, 9 Dec 2001 07:54:52 -0600 From: "Norman" Subject: Re: [CANSLIM] Another Question: Beakouts ... This is a multi-part message in MIME format. - ------=_NextPart_000_0013_01C18086.C90B0480 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Hi Andreas, I like, and have begun to use, Katherine's option number 3. This is not = a bad method if canslim criteria are met. If there is good vol on the = right side of the base (unless it's a flat base) then funds are buying, = if the base and handle are correctly formed, if the company has = outstanding fundamentals, if the GRS is good and trending up, if it's = peers are doing well on the average, etc. I know this is a lot to ask = but this market has not been very forgiven for CANSLIMers lately. And = often the stock will not break out for days or weeks or not at all. But = you will have the odds on your side; a good company, with big money = support and a good chart. The only real problems I have noted are 1) = that I have to sit around and watch other stocks on my list shoot up = (unavoidable), and 2) if the handle is 10-15% off the pivot then there = has to be a substantial move just to get to my buy order; this increases = the likely hood of a second handle or that my order will execute and the = price will close below that point. I am willing to live with these = risks if the company is top notch. I don't see the low vol breakout as = much of a risk; at least I would be making money. If the company, chart = and GRS are good then I would hold the low vol BO with a shallow s/l = order in place. I guess then I would be an "aggressive value investor". = Additionally, this may be the only way to buy the flat base or LLUR; = they seem to often shoot up out of their pattern quickly. disclaimer: I'm an amateur with much less experience than most :-) Norm - ----- Original Message -----=20 From: "Katherine Malm" To: Sent: Saturday, December 08, 2001 11:44 PM Subject: Re: [CANSLIM] Another Question: Beakouts ... > Hi Andreas, >=20 > > And then you wait all day until they breakout? So Canslim can only = be done > by people who > > do this full time? > > Even a Stop buy does not work because you do not know if the volume = is at > least 50% higher then > > average. >=20 > Option 1: If you are trading full time, but don't want to sit at the > computer all day and watch the quote screen, use trading software that > allows you to set audible alarms when the stock on your wishlist meets > certain price and/or volume criteria. I do this with Schwab's = Streetsmart > Pro. At the beginning of each trading day, I update my alarms based on = my > strategy for the day. If the alarms go off, I look at the screen. If = they > don't, I don't have to watch at all. >=20 > Option 2: Use a service that sends these alarms to your pager or = digital > phone. Many brokerages offer this option. If your employer has no = problem > with you placing trades during your work day, this works well. = Extrapolating > volume intraday will give a feel as to breakout potential. >=20 > Option 3: If you are working at a job other than trading and do not or > cannot trade during market hours, using a buy-stop-limit is the only = way to > make entries at the time of the first breakout attempt. Unfortunately, = these > are not volume dependent, as you noted. If you are convinced that this = is a > stock worth owning, you set up the trade and see what happens. If you = can > check volume at lunchtime, that may help you assess whether or not to = cancel > the order if it has not yet executed. If the buy was executed during = the day > but on your end-of-day review you see that the appropriate minimum = volume > was not met, sell it the next day. Plain and simple. Cost of doing = business. > While a stock breaking out on below average volume may not necessarily = fail, > the *probability* of failure is higher. That's reason enough to exit = the > trade. >=20 > Option 4: If the stock broke out but finished the day within 5% of the > pivot, place a limit order for the open. If you get it, fine. If you = don't, > well there's 9,999 other stocks in the universe. >=20 > Katherine >=20 >=20 >=20 >=20 > ----- Original Message ----- > From: "Andreas Himmelreich" > To: > Sent: Saturday, December 08, 2001 9:55 PM > Subject: [CANSLIM] Another Question: Beakouts ... >=20 >=20 > > How do you spot breakouts? > > > > OK, I have a watchlist on stocks that are fundamentally and = technically > interesting. > > And then you wait all day until they breakout? So Canslim can only = be done > by people who > > do this full time? > > > > Even a Stop buy does not work because you do not know if the volumne = is at > least 50% higher then > > average. > > > > Alternative is to buy on the second day of the breakout, but this = should > only be done if > > the price is not higher then 10% above the pivot? A lot of breakouts = do > 10% and more on the > > breakout day. > > > > So how do you do this? >=20 >=20 > - > -To subscribe/unsubscribe, email "majordomo@xmission.com" > -In the email body, write "subscribe canslim" or > -"unsubscribe canslim". Do not use quotes in your email. >=20 >=20 - ------=_NextPart_000_0013_01C18086.C90B0480 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Hi Andreas,
 
I like, and have begun to use, Katherine's option number 3.  = This is=20 not a bad method if canslim criteria are met.  If there is good = vol on=20 the right side of the base (unless it's a flat base) then funds are = buying,=20 if the base and handle are correctly formed, if the company has=20 outstanding fundamentals, if the GRS is good and trending up, if it's = peers are=20 doing well on the average, etc.  I know this is a lot to ask but = this=20 market has not been very forgiven for CANSLIMers lately.  And = often=20 the stock will not break out for days or weeks or not at all.  But = you will=20 have the odds on your side; a good company, with big money support and a = good=20 chart.  The only real problems I have noted are 1) that I have to = sit=20 around and watch other stocks on my list shoot up (unavoidable), and 2) = if the=20 handle is 10-15% off the pivot then there has to be a substantial move = just to=20 get to my buy order; this increases the likely hood of a second handle = or that=20 my order will execute and the price will close below that point.  I = am=20 willing to live with these risks if the company is top notch.  I = don't see=20 the low vol breakout as much of a risk; at least I would be making = money. =20 If the company, chart and GRS are good then I would hold the low = vol BO=20 with a shallow s/l order in place.  I guess then I would be an = "aggressive=20 value investor".  Additionally, this may be the only way to buy the = flat=20 base or LLUR; they seem to often shoot up out of their pattern = quickly.
 
disclaimer: I'm an amateur with much less experience than most = :-)
 
Norm
 
----- Original Message -----
From: "Katherine Malm" <kmalm@earthlink.net>
To: <canslim@lists.xmission.com= >
Sent: Saturday, December 08, 2001 11:44 PM
Subject: Re: [CANSLIM] Another Question: Beakouts ...

> Hi Andreas,
>
> > And then you wait = all day=20 until they breakout? So Canslim can only be done
> by people = who
>=20 > do this full time?
> > Even a Stop buy does not work = because you=20 do not know if the volume is at
> least 50% higher then
> = >=20 average.
>
> Option 1: If you are trading full time, but = don't want=20 to sit at the
> computer all day and watch the quote screen, use = trading=20 software that
> allows you to set audible alarms when the stock on = your=20 wishlist meets
> certain price and/or volume criteria. I do this = with=20 Schwab's Streetsmart
> Pro. At the beginning of each trading day, = I update=20 my alarms based on my
> strategy for the day. If the alarms go = off, I look=20 at the screen. If they
> don't, I don't have to watch at = all.
>=20
> Option 2: Use a service that sends these alarms to your pager = or=20 digital
> phone. Many brokerages offer this option. If your = employer has=20 no problem
> with you placing trades during your work day, this = works=20 well. Extrapolating
> volume intraday will give a feel as to = breakout=20 potential.
>
> Option 3: If you are working at a job other = than=20 trading and do not or
> cannot trade during market hours, using a=20 buy-stop-limit is the only way to
> make entries at the time of = the first=20 breakout attempt. Unfortunately, these
> are not volume dependent, = as you=20 noted. If you are convinced that this is a
> stock worth owning, = you set=20 up the trade and see what happens. If you can
> check volume at = lunchtime,=20 that may help you assess whether or not to cancel
> the order if = it has=20 not yet executed. If the buy was executed during the day
> but on = your=20 end-of-day review you see that the appropriate minimum volume
> = was not=20 met, sell it the next day. Plain and simple. Cost of doing = business.
>=20 While a stock breaking out on below average volume may not necessarily=20 fail,
> the *probability* of failure is higher. That's reason = enough to=20 exit the
> trade.
>
> Option 4: If the stock broke = out but=20 finished the day within 5% of the
> pivot, place a limit order for = the=20 open. If you get it, fine. If you don't,
> well there's 9,999 = other stocks=20 in the universe.
>
> Katherine
>
>
> =
>=20
> ----- Original Message -----
> From: "Andreas = Himmelreich" <judgejimmy@web.de>
> To: = <canslim@lists.xmission.com= >
>=20 Sent: Saturday, December 08, 2001 9:55 PM
> Subject: [CANSLIM] = Another=20 Question: Beakouts ...
>
>
> > How do you spot=20 breakouts?
> >
> > OK, I have a watchlist on stocks = that are=20 fundamentally and technically
> interesting.
> > And then = you=20 wait all day until they breakout? So Canslim can only be done
> by = people=20 who
> > do this full time?
> >
> > Even a = Stop buy=20 does not work because you do not know if the volumne is at
> least = 50%=20 higher then
> > average.
> >
> > Alternative = is to=20 buy on the second day of the breakout, but this should
> only be = done=20 if
> > the price is not higher then 10% above the pivot? A lot = of=20 breakouts do
> 10% and more on the
> > breakout = day.
>=20 >
> > So how do you do this?
>
>
> = - -
> -To=20 subscribe/unsubscribe, email "majordomo@xmission.com"
>= ; -In the=20 email body, write "subscribe canslim" or
> -"unsubscribe = canslim". =20 Do not use quotes in your email.
>
> - ------=_NextPart_000_0013_01C18086.C90B0480-- - - - -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: Sun, 9 Dec 2001 07:25:27 -0600 From: "Katherine Malm" Subject: Re: [CANSLIM] Another Question: Beakouts ... This is a multi-part message in MIME format. - ------=_NextPart_000_0491_01C18082.ACB177A0 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Mornin' Norm, Sure seems to me the approach you are describing shows greater depth of = understanding than many professionals have. None of the 4 options listed = are worth a flip unless the candidate is superior and I think that's = what people forget in their rush to fill the portfolio with positions. = Your alternative, which I'll call "option 5" shows a different entry = strategy supported by your own individual style. My own style is to move = quickly out of something if it doesn't do what I'm expecting in the near = term. But I continue to monitor the candidate in case it was a false = start, then get right back in. That means that under some market = conditions it might take me two entries, but my loss the first time is = generally well under the 7-8% rule, so I write that off as "risk = control." As you have pointed out, everyone has their own risk tolerance = and patience factor and finding a strategy that fits that personality = makes all the difference in success rate. Katherine - ----- Original Message -----=20 From: Norman=20 To: canslim@lists.xmission.com=20 Sent: Sunday, December 09, 2001 7:54 AM Subject: Re: [CANSLIM] Another Question: Beakouts ... Hi Andreas, I like, and have begun to use, Katherine's option number 3. This is = not a bad method if canslim criteria are met. If there is good vol on = the right side of the base (unless it's a flat base) then funds are = buying, if the base and handle are correctly formed, if the company has = outstanding fundamentals, if the GRS is good and trending up, if it's = peers are doing well on the average, etc. I know this is a lot to ask = but this market has not been very forgiven for CANSLIMers lately. And = often the stock will not break out for days or weeks or not at all. But = you will have the odds on your side; a good company, with big money = support and a good chart. The only real problems I have noted are 1) = that I have to sit around and watch other stocks on my list shoot up = (unavoidable), and 2) if the handle is 10-15% off the pivot then there = has to be a substantial move just to get to my buy order; this increases = the likely hood of a second handle or that my order will execute and the = price will close below that point. I am willing to live with these = risks if the company is top notch. I don't see the low vol breakout as = much of a risk; at least I would be making money. If the company, chart = and GRS are good then I would hold the low vol BO with a shallow s/l = order in place. I guess then I would be an "aggressive value investor". = Additionally, this may be the only way to buy the flat base or LLUR; = they seem to often shoot up out of their pattern quickly. disclaimer: I'm an amateur with much less experience than most :-) Norm ----- Original Message -----=20 From: "Katherine Malm" To: Sent: Saturday, December 08, 2001 11:44 PM Subject: Re: [CANSLIM] Another Question: Beakouts ... > Hi Andreas, >=20 > > And then you wait all day until they breakout? So Canslim can only = be done > by people who > > do this full time? > > Even a Stop buy does not work because you do not know if the = volume is at > least 50% higher then > > average. >=20 > Option 1: If you are trading full time, but don't want to sit at the > computer all day and watch the quote screen, use trading software = that > allows you to set audible alarms when the stock on your wishlist = meets > certain price and/or volume criteria. I do this with Schwab's = Streetsmart > Pro. At the beginning of each trading day, I update my alarms based = on my > strategy for the day. If the alarms go off, I look at the screen. If = they > don't, I don't have to watch at all. >=20 > Option 2: Use a service that sends these alarms to your pager or = digital > phone. Many brokerages offer this option. If your employer has no = problem > with you placing trades during your work day, this works well. = Extrapolating > volume intraday will give a feel as to breakout potential. >=20 > Option 3: If you are working at a job other than trading and do not = or > cannot trade during market hours, using a buy-stop-limit is the only = way to > make entries at the time of the first breakout attempt. = Unfortunately, these > are not volume dependent, as you noted. If you are convinced that = this is a > stock worth owning, you set up the trade and see what happens. If = you can > check volume at lunchtime, that may help you assess whether or not = to cancel > the order if it has not yet executed. If the buy was executed during = the day > but on your end-of-day review you see that the appropriate minimum = volume > was not met, sell it the next day. Plain and simple. Cost of doing = business. > While a stock breaking out on below average volume may not = necessarily fail, > the *probability* of failure is higher. That's reason enough to exit = the > trade. >=20 > Option 4: If the stock broke out but finished the day within 5% of = the > pivot, place a limit order for the open. If you get it, fine. If you = don't, > well there's 9,999 other stocks in the universe. >=20 > Katherine >=20 >=20 >=20 >=20 > ----- Original Message ----- > From: "Andreas Himmelreich" > To: > Sent: Saturday, December 08, 2001 9:55 PM > Subject: [CANSLIM] Another Question: Beakouts ... >=20 >=20 > > How do you spot breakouts? > > > > OK, I have a watchlist on stocks that are fundamentally and = technically > interesting. > > And then you wait all day until they breakout? So Canslim can only = be done > by people who > > do this full time? > > > > Even a Stop buy does not work because you do not know if the = volumne is at > least 50% higher then > > average. > > > > Alternative is to buy on the second day of the breakout, but this = should > only be done if > > the price is not higher then 10% above the pivot? A lot of = breakouts do > 10% and more on the > > breakout day. > > > > So how do you do this? >=20 >=20 > - > -To subscribe/unsubscribe, email "majordomo@xmission.com" > -In the email body, write "subscribe canslim" or > -"unsubscribe canslim". Do not use quotes in your email. >=20 >=20 - ------=_NextPart_000_0491_01C18082.ACB177A0 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Mornin' Norm,
 
Sure seems to me the approach you are = describing=20 shows greater depth of understanding than many professionals have. None = of the 4=20 options listed are worth a flip unless the candidate is superior and I = think=20 that's what people forget in their rush to fill the portfolio with = positions.=20 Your alternative, which I'll call "option 5" shows a different entry = strategy=20 supported by your own individual style. My own style is to move quickly = out of=20 something if it doesn't do what I'm expecting in the near term. But I = continue=20 to monitor the candidate in case it was a false start, then get right = back in.=20 That means that under some market conditions it might take me two = entries, but=20 my loss the first time is generally well under the 7-8% rule, so I write = that=20 off as "risk control." As you have pointed out, everyone has their own = risk=20 tolerance and patience factor and finding a strategy that fits that = personality=20 makes all the difference in success rate.
 
Katherine
 
 
 
----- Original Message -----
From:=20 Norman
Sent: Sunday, December 09, 2001 = 7:54=20 AM
Subject: Re: [CANSLIM] Another = Question:=20 Beakouts ...

Hi Andreas,
 
I like, and have begun to use, Katherine's option number 3.  = This is=20 not a bad method if canslim criteria are met.  If there is good=20 vol on the right side of the base (unless it's a flat base) = then=20 funds are buying, if the base and handle are correctly formed, = if the=20 company has outstanding fundamentals, if the GRS is good and trending = up, if=20 it's peers are doing well on the average, etc.  I know this is a = lot to=20 ask but this market has not been very forgiven for CANSLIMers=20 lately.  And often the stock will not break out for days or weeks = or not=20 at all.  But you will have the odds on your side; a good company, = with=20 big money support and a good chart.  The only real problems I = have noted=20 are 1) that I have to sit around and watch other stocks on my list = shoot up=20 (unavoidable), and 2) if the handle is 10-15% off the pivot then there = has to=20 be a substantial move just to get to my buy order; this increases the = likely=20 hood of a second handle or that my order will execute and the price = will close=20 below that point.  I am willing to live with these risks if the = company=20 is top notch.  I don't see the low vol breakout as much of a = risk; at=20 least I would be making money.  If the company, chart and = GRS are=20 good then I would hold the low vol BO with a shallow s/l order in = place. =20 I guess then I would be an "aggressive value investor".  = Additionally,=20 this may be the only way to buy the flat base or LLUR; they seem to = often=20 shoot up out of their pattern quickly.
 
disclaimer: I'm an amateur with much less experience than most = :-)
 
Norm
 
----- Original Message -----
From: "Katherine Malm" <kmalm@earthlink.net>
To: <canslim@lists.xmission.com= >
Sent: Saturday, December 08, 2001 11:44 PM
Subject: Re: [CANSLIM] Another Question: Beakouts ...

> Hi Andreas,
>
> > And then you = wait all=20 day until they breakout? So Canslim can only be done
> by people = who
> > do this full time?
> > Even a Stop buy does = not work=20 because you do not know if the volume is at
> least 50% higher=20 then
> > average.
>
> Option 1: If you are = trading full=20 time, but don't want to sit at the
> computer all day and watch = the=20 quote screen, use trading software that
> allows you to set = audible=20 alarms when the stock on your wishlist meets
> certain price = and/or=20 volume criteria. I do this with Schwab's Streetsmart
> Pro. At = the=20 beginning of each trading day, I update my alarms based on my
> = strategy=20 for the day. If the alarms go off, I look at the screen. If = they
>=20 don't, I don't have to watch at all.
>
> Option 2: Use a = service=20 that sends these alarms to your pager or digital
> phone. Many=20 brokerages offer this option. If your employer has no problem
> = with you=20 placing trades during your work day, this works well. = Extrapolating
>=20 volume intraday will give a feel as to breakout potential.
> =
>=20 Option 3: If you are working at a job other than trading and do not = or
>=20 cannot trade during market hours, using a buy-stop-limit is the only = way=20 to
> make entries at the time of the first breakout attempt.=20 Unfortunately, these
> are not volume dependent, as you noted. = If you=20 are convinced that this is a
> stock worth owning, you set up = the trade=20 and see what happens. If you can
> check volume at lunchtime, = that may=20 help you assess whether or not to cancel
> the order if it has = not yet=20 executed. If the buy was executed during the day
> but on your=20 end-of-day review you see that the appropriate minimum volume
> = was not=20 met, sell it the next day. Plain and simple. Cost of doing = business.
>=20 While a stock breaking out on below average volume may not necessarily = fail,
> the *probability* of failure is higher. That's reason = enough to=20 exit the
> trade.
>
> Option 4: If the stock broke = out but=20 finished the day within 5% of the
> pivot, place a limit order = for the=20 open. If you get it, fine. If you don't,
> well there's 9,999 = other=20 stocks in the universe.
>
> Katherine
>
> =
>=20
>
> ----- Original Message -----
> From: "Andreas=20 Himmelreich" <judgejimmy@web.de>
> = To: <canslim@lists.xmission.com= >
>=20 Sent: Saturday, December 08, 2001 9:55 PM
> Subject: [CANSLIM] = Another=20 Question: Beakouts ...
>
>
> > How do you spot=20 breakouts?
> >
> > OK, I have a watchlist on stocks = that are=20 fundamentally and technically
> interesting.
> > And = then you=20 wait all day until they breakout? So Canslim can only be done
> = by=20 people who
> > do this full time?
> >
> > = Even a=20 Stop buy does not work because you do not know if the volumne is = at
>=20 least 50% higher then
> > average.
> >
> >=20 Alternative is to buy on the second day of the breakout, but this=20 should
> only be done if
> > the price is not higher = then 10%=20 above the pivot? A lot of breakouts do
> 10% and more on = the
>=20 > breakout day.
> >
> > So how do you do = this?
>=20
>
> -
> -To subscribe/unsubscribe, email "majordomo@xmission.com"
>= ; -In=20 the email body, write "subscribe canslim" or
> -"unsubscribe=20 canslim".  Do not use quotes in your email.
>
>=20 - ------=_NextPart_000_0491_01C18082.ACB177A0-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ End of canslim-digest V2 #1910 ****************************** 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.