From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #2718 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 Saturday, August 3 2002 Volume 02 : Number 2718 In this issue: [CANSLIM] Accessing the discussion canslim archives... [CANSLIM] Market trend [CANSLIM] Worley's Weekend Weeview Re: [CANSLIM] Market trend Re: [CANSLIM] Sometimes even the Pros don't know ---------------------------------------------------------------------- Date: Sat, 03 Aug 2002 08:00:00 -0600 From: owner-canslim@xmission.com (Jeff Salisbury) Subject: [CANSLIM] Accessing the discussion canslim archives... From time to time, CANSLIM members may wish to browse the discussion archives. This posting provides instructions on how to access the archives. Thanks to David Cameron for compiling the essentials of this message. Here are the two ways to access the archives: 1. The best way is to use your web browser. To browse the archives, point your browser to: ftp://ftp.xmission.com/pub/lists/canslim/archive/ 2. (Not as convenient) via email: Send an email to majordomo@xmission.com with the following as the body of your message: "index canslim". Then send a follow up email to request an old email from either the "archive" or "latest" directory. Note that your request must be in the body of your email. For example: "get canslim latest/001" will retrieve file "001" from the "latest" directory. "get canslim archive/v01.n066" will retrieve file "v01.n066" from the "archive" dir. Best Regards, Jeff Salisbury - CANSLIM list owner/admin - - - -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: Sat, 03 Aug 2002 10:19:27 -0400 From: "Gary A. Snyder" Subject: [CANSLIM] Market trend All: I look at Market trend at MSN provided by Camelback Research Alliance, Inc. The trend has been getting progressively worse. On Tuesday July 30 everything turned to: out of favor- All sectors- All investment styles- Growth and Value- All size companies, the first time I have seen this posture. Imagine my surprise when I see today a major change in trend: All sectors but Public utilities and Tech now neutral, all sizes neutral and both investment styles neutral. Also get a market trend prediction from MarketEdge. The bottom line: With the DJIA staying above its previous intraday low a major change in market trend is predicted with the rating of Bearish -5 going to a bullish +5. Question: Have we seen a major trend reversal in the market this week? Can all the problems with Accounting, Terrorism, Overvaluations, Double dip recession and the Possibility Consumer spending slowing be ignored by the market for more than a week or two? Gary _________________________________________________________________ Send and receive Hotmail on your mobile device: http://mobile.msn.com - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Sat, 3 Aug 2002 11:04:04 -0400 From: "Tom Worley" Subject: [CANSLIM] Worley's Weekend Weeview This is a multi-part message in MIME format. - ------=_NextPart_000_00CD_01C23ADD.7B1D33D0 Content-Type: multipart/alternative; boundary="----=_NextPart_001_00CE_01C23ADD.7B1D33D0" - ------=_NextPart_001_00CE_01C23ADD.7B1D33D0 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable RECESSION REALLY HAPPENED!! It's official, the government has revised the GDP figures for year 2001 = (how come this is any different than a corporation revising its = financial accounting?? why aren't they hauled before Congress and = grilled as well??) and now confirm that we had three quarters of = economic contraction (negative growth, if you prefer the govt double = talk). Amazing that it took them this long to do the math, but they = have now decided that the four quarters of 2001, on an annual basis, = were minus 0.6% (from plus 1.3%), minus 1.6% (from plus 0.3%), and minus = 0.3% (from minus 1.3%). They left the 4th qtr unchanged at plus 2.7%, = maybe they will do something with that in a year or so. Makes you wonder = just have far we can trust current GDP reports and numbers. And these = are the people we trust not only to figure out what we owe in taxes, but = how to spend it as well!!!=20 Talk of a double dip into recession is also heating up, more economists = are now expecting that a Fed rate hike will not happen until next year, = most mentioned is second and third quarter. And Goldman Sachs, which was = the first to forecast (besides me, that is) unchanged rates the rest of = the year now expects a 75 basis point CUT by year end, most likely after = the August or Sept meeting. I wonder how many will actually benefit from = further rate cuts, my adjustable mortgage is already at the minimum, = can't go lower. And rates for new loans have not fallen as much as the = Feds already cut. With the Fed rate at 1.75% now, anybody seen credit = cards advertising rates under 5%?? - -------------------------------------------------------------------------= - ------- ECONOMICS - A BLEAK WEAK WEEK Conference Board says its Consumer Confidence Index fell more than = expected for July, ending at 97.1. Expectations were for a drop from = 106.3 to only 101.5. The Chicago NAPM Index dropped sharply to 51.5 in July from 58.2, well = under expectations of a drop to 56.7. The Chicago index is often a = barometer for the national ISM Index, which confirmed it Thursday with a = drop from 56.2 down to 50.5 (against an expectation of 55.0). It's not = contraction yet, but another month like this and it will be. It was a bad week for economics, and hopes for a swift, much less = strong, recovery. The first estimate of the GDP for second quarter came = in at a 1.1% annual growth rate, well below forecasts of 2.2 to 2.8%. = And First Quarter was revised down to 5.0% from 6.1%. One bright spot in = the Q2 report was a 2.9% growth in business spending on software = equipment, first gain since Q3 of 2000. Factory orders in June fell 2.4%, expected was a drop of 1.7%. Unemployment held steady at 5.9% as expected, however new jobs creation = was well under expectations of 60,000, with only 6,000 total. But this = would have been much better had the June report not been revised upward = by 30,000 jobs. And unemployment is a lagging indicator, with it = increasing typically during the first six months or so of a recovery = from recession, so guess we are doing better than the norms with any = jobs creation (how's that for the "glass half full" perspective, as long = as you are not one of the ones still unemployed??). Personal income in June rose 0.6% (ok, who got mine??) while personal = spending rose 0.5%. Other reports suggest increases were on non durable = goods, altho reports also show the consumer is still willing to spend on = the big ticket non durable goods merchandise. - -------------------------------------------------------------------------= - ------- "M" During July, more than 100 corporations announced stock buyback plans, = including MRK and HD, totaling over $43 billion dollars. This was the = second largest total for one month, only eclipsed by last September. WON = likes corp buybacks, and could be another sign of a bottom. Offsetting = this is an estimated $50 billion outflow from mutual funds during July, = as well as continued outflow of foreign investment money. The FRB Valuation Model, now becoming more popular because it includes = employee options costs, pegs stocks as 30% undervalued. And the DOW, = NYSE Composite, NYSE Financial, DJ Utilities (flight to safety??) and = S&P500 managed to end the week with a small gain, even while the NASDAQ = and Russell 2000 finished slightly lower for the week, and the SOX Index = continued down sharply. - -------------------------------------------------------------------------= - ------- WORLEY'S WATCHLIST WANNABES=20 This list is in no way intended to recommend any stocks to the group. It = is a part of my regular assessment of the health of CANSLIM's "M" and, = as the name implies, only intended to identify some stocks with = constructive chart patterns that may be worth WATCHING and learning from = (and of course doing your own due diligence). I am employed in = Operations by a US Broker Dealer, however everything presented by me is = strictly my own ideas and in no way should be taken to reflect the views = or opinions of my employer. I typically list stocks with both RS and EPS ranking of 80 or better, = and try to exclude stocks undergoing any merger / acquisition / buyout = scenario. I no longer will actively consider earnings forecast for this = year and next due the confusing data presented by DGO. I do no other due = diligence, that is your responsibility. I will note any CANSLIM patterns = I see, such as c&h, double (or triple) bottoms, or flat bases (shown as = Bx where "x" is the # of weeks, IMO). I will also note LLUR (Lower Left = Upper Right) even though it is not exactly a CANSLIM pattern. The population of stocks I am reviewing this weekend remains small and = weak. I used performance over the 50 dma throughout the week, and found = it gave a better picture than sticking only to stocks making new highs. ALAB - funnel pattern back to the flat base ANDE - holding up well, boring grain company with low forecasts, I let = this one go too soon!! APOL - double bottom AROW - extreme behaviour, excessive double bottom on an ascending base BLUD - LLUR, just keeps on pumping CTSH - channeling (draw a line along the highs and lows) DCOM - for learning only, failed double bottom pattern, below the center = point on volume DOCC - my only "gem" I own, building a high base possibly DORL - double bottom FCN - sloppy LLUR getting sloppier FSTW - consolidating, has not filled in the big gap up, in my VR Fund PORT - LLUR SBMC - nice double bottom, pivot approaching SSNC - consolidation, in my VR Fund Happy hunting, and good luck Tom Worley stkguru@bellsouth.net AIM: TexWorley - ------=_NextPart_001_00CE_01C23ADD.7B1D33D0 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
RECESSION REALLY = HAPPENED!!
It's official, the government has revised the = GDP figures=20 for year 2001 (how come this is any different than a corporation = revising its=20 financial accounting?? why aren't they hauled before Congress and = grilled as=20 well??) and now confirm that we had three quarters of economic = contraction=20 (negative growth, if you prefer the govt double talk).  Amazing = that it=20 took them this long to do the math, but they have now decided that the = four=20 quarters of 2001, on an annual basis, were minus 0.6% (from plus 1.3%), = minus=20 1.6% (from plus 0.3%), and minus 0.3% (from minus 1.3%). They left the = 4th qtr=20 unchanged at plus 2.7%, maybe they will do something with that in a year = or so.=20 Makes you wonder just have far we can trust current GDP reports and = numbers. And=20 these are the people we trust not only to figure out what we owe in = taxes, but=20 how to spend it as well!!!
 
Talk of a double dip into recession is also = heating up,=20 more economists are now expecting that a Fed rate hike will not happen = until=20 next year, most mentioned is second and third quarter. And Goldman = Sachs, which=20 was the first to forecast (besides me, that is) unchanged rates the rest = of the=20 year now expects a 75 basis point CUT by year end, most likely after the = August=20 or Sept meeting. I wonder how many will actually benefit from further = rate cuts,=20 my adjustable mortgage is already at the minimum, can't go lower. And = rates for=20 new loans have not fallen as much as the Feds already cut. With the Fed = rate at=20 1.75% now, anybody seen credit cards advertising rates under 5%??
ECONOMICS - A BLEAK WEAK=20 WEEK
Conference Board says its Consumer Confidence = Index fell=20 more than expected for July, ending at 97.1. Expectations were for a = drop from=20 106.3 to only 101.5.
 
The Chicago NAPM Index dropped sharply to 51.5 = in July=20 from 58.2, well under expectations of a drop to 56.7. The Chicago index = is often=20 a barometer for the national ISM Index, which confirmed it Thursday with = a drop=20 from 56.2 down to 50.5 (against an expectation of 55.0). It's not = contraction=20 yet, but another month like this and it will be.
 
It was a bad week for economics, and = hopes for a=20 swift, much less strong, recovery. The first estimate of the GDP for = second=20 quarter came in at a 1.1% annual growth rate, well below forecasts of = 2.2 to=20 2.8%. And First Quarter was revised down to 5.0% from 6.1%. One bright = spot in=20 the Q2 report was a 2.9% growth in business spending on software = equipment,=20 first gain since Q3 of 2000.
 
Factory orders in June fell 2.4%, expected was a = drop of=20 1.7%.
 
Unemployment held steady at 5.9% as expected, = however new=20 jobs creation was well under expectations of 60,000, with only 6,000 = total. But=20 this would have been much better had the June report not been revised = upward by=20 30,000 jobs. And unemployment is a lagging indicator, with it increasing = typically during the first six months or so of a recovery from = recession, so=20 guess we are doing better than the norms with any jobs creation (how's = that for=20 the "glass half full" perspective, as long as you are not one of the = ones still=20 unemployed??).
 
Personal income in June rose 0.6% (ok, who got = mine??)=20 while personal spending rose 0.5%. Other reports suggest increases were = on non=20 durable goods, altho reports also show the consumer is still willing to = spend on=20 the big ticket non durable goods merchandise.
"M"
During July, more than 100 corporations announced stock buyback = plans,=20 including MRK and HD, totaling over $43 billion dollars. This was the = second=20 largest total for one month, only eclipsed by last September. WON likes = corp=20 buybacks, and could be another sign of a bottom. Offsetting this is an = estimated=20 $50 billion outflow from mutual funds during July, as well as continued = outflow=20 of foreign investment money.
 
The FRB Valuation Model, now becoming more popular because it = includes=20 employee options costs, pegs stocks as 30% undervalued. And the DOW, = NYSE=20 Composite, NYSE Financial, DJ Utilities (flight to safety??) and = S&P500=20 managed to end the week with a small gain, even while the NASDAQ=20 and Russell 2000 finished slightly lower for the week, and the SOX = Index=20 continued down sharply.
WORLEY'S WATCHLIST WANNABES=20
This list is in no way intended to recommend any = stocks to=20 the group. It is a part of my regular assessment of the health of = CANSLIM's "M"=20 and, as the name implies, only intended to identify some stocks with=20 constructive chart patterns that may be worth WATCHING and learning from = (and of=20 course doing your own due diligence). I am=20 employed in Operations by a US Broker Dealer, however everything = presented by me=20 is strictly my own ideas and in no way should be taken to reflect the = views or=20 opinions of my employer.
 
I typically list stocks with both RS and EPS = ranking of 80=20 or better, and try to exclude stocks undergoing any merger / acquisition = /=20 buyout scenario. I no longer will actively = consider earnings=20 forecast for this year and next due the confusing data presented by DGO. = I do no=20 other due diligence, that is your responsibility. I will note any = CANSLIM=20 patterns I see, such as c&h, double (or triple) bottoms, or flat = bases=20 (shown as Bx where "x" is the # of weeks, IMO). I will also note LLUR = (Lower=20 Left Upper Right) even though it is not exactly a CANSLIM = pattern.
 
The population of stocks I am reviewing this = weekend=20 remains small and weak. I used performance over the 50 dma throughout = the week,=20 and found it gave a better picture than sticking only to stocks making = new=20 highs.
 
ALAB - funnel pattern back to the flat base
ANDE - holding up well, boring grain company with low forecasts, I = let this=20 one go too soon!!
APOL - double bottom
AROW - extreme behaviour, excessive double bottom on an ascending=20 base
BLUD - LLUR, just keeps on pumping
CTSH - channeling (draw a line along the highs and lows)
DCOM - for learning only, failed double bottom pattern, below the = center=20 point on volume
DOCC - my only "gem" I own, building a high base possibly
DORL - double bottom
FCN - sloppy LLUR getting sloppier
FSTW - consolidating, has not filled in the big gap up, in my VR = Fund
PORT - LLUR
SBMC - nice double bottom, pivot approaching
SSNC - consolidation, in my VR Fund
 
Happy hunting, and good luck
 
3D""
Tom Worley
stkguru@bellsouth.net
AIM: = TexWorley
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Do not use quotes in your email. ------------------------------ Date: Sat, 3 Aug 2002 11:11:31 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] Market trend Gary, I do not see a change yet in the market trend. Worse, for me at least, is that the disconnect between economics and market trend grew closer this week as a result of poor economic results. But I also don't get the sense that we have yet to get the sheer stark fear that the market will collapse, that might ultimately mark the bottom. - ----- Original Message ----- From: "Gary A. Snyder" To: Sent: Saturday, August 03, 2002 10:19 AM Subject: [CANSLIM] Market trend All: I look at Market trend at MSN provided by Camelback Research Alliance, Inc. The trend has been getting progressively worse. On Tuesday July 30 everything turned to: out of favor- All sectors- All investment styles- Growth and Value- All size companies, the first time I have seen this posture. Imagine my surprise when I see today a major change in trend: All sectors but Public utilities and Tech now neutral, all sizes neutral and both investment styles neutral. Also get a market trend prediction from MarketEdge. The bottom line: With the DJIA staying above its previous intraday low a major change in market trend is predicted with the rating of Bearish -5 going to a bullish +5. Question: Have we seen a major trend reversal in the market this week? Can all the problems with Accounting, Terrorism, Overvaluations, Double dip recession and the Possibility Consumer spending slowing be ignored by the market for more than a week or two? Gary _________________________________________________________________ Send and receive Hotmail on your mobile device: http://mobile.msn.com - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -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: Sat, 3 Aug 2002 07:30:12 -0700 From: "John Calkins" Subject: Re: [CANSLIM] Sometimes even the Pros don't know This is a multi-part message in MIME format. - ------=_NextPart_000_0035_01C23ABF.9A8A13A0 Content-Type: text/plain; charset="Windows-1252" Content-Transfer-Encoding: quoted-printable Scott, I would have to agree with your failing base on base pattern. Katherine, would it be better to consider staying with the classic = double bottom than trying to interpret a new lazy W pattern? Doesn't = this relate to how WON developed the CWH? Didn't He, Livermore and = others already explore these regions and shouldn't we learn from them, = or do we always question their results. I realize that we need to learn = from each other how to interpret these patterns. It's like trying to = explore too far off the beaten path, like a child getting too close to = the crumbling edge or using a 10% stop rule instead of an 8%. Is a lazy = W too close to the crumbling edge especially in this market? We are = told that these patterns are useful in a bull market. The bear pops up = on Thursday and Friday, then a pattern seems to fail and again reminds = us to get back on the path.. Again and again, the closer I stay to the = classic patterns, the less I am inclined to get into this market. = CANSLIM and WON's Technical's seem to be working for me by keeping me on = the sidelines until this market speaks to me in a clearer voice. John=20 ----- Original Message -----=20 From: Scott Gettis=20 To: canslim@lists.xmission.com=20 Sent: Friday, August 02, 2002 9:27 AM Subject: RE: [CANSLIM] Sometimes even the Pros don't know here's my interpretation. If we have to make up a name for the pattern that sie is forming, = maybe it is not really a sound base. I agree that sie at this moment = seems to be a leader in this market, but the base that it formed is too = deep to be considered a flat base, and it does not have the classic = characteristics of a double bottom. To me it looks most like a base on = base structure; with the first part from 4/30-6/19 - and the second part = the most recent base - which was rather short. Hey the pattern may = work, in which case ill add the lazy w to my list of charts to look for. = But, in this market where breakouts are still not working why try to = force it with a price structure that can be labeled suspect at best. -----Original Message----- From: owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com]On Behalf Of Katherine Malm Sent: Friday, August 02, 2002 8:13 AM To: canslim@lists.xmission.com Subject: Re: [CANSLIM] Sometimes even the Pros don't know Hi Donald, My comments below were to show how the base count restarts, rather = than looking back as far as 4 years ago at the chart and concluding that = it is a 4 year C&H. That means that the stock broke out of a fresh 1st = base August last year, and that the more recent action, for lack of a = better term "Lazy W" would be considered on its own, rather than as a = part of the 4 year pattern. That makes it a 2nd stage base. More specifically, the recent base doesn't meet the criteria for = either a C&H or the shallower Saucer & Handle because of that odd price = peak in the center of the formation. More than anything, take a look at = the volume pattern as the center of the LazyW forms, it's very high. = Normally in a C&H or S&H, the volume dries up at the bottom of the cup. = This is exactly the opposite, showing that SIE was trying desperately to = breakout, but was knocked back into its consolidation on high volume. Katherine ----- Original Message -----=20 From: Donald Wallker=20 To: canslim@lists.xmission.com=20 Sent: Friday, August 02, 2002 9:14 AM Subject: Re: [CANSLIM] Sometimes even the Pros don't know Katherine =3D =3D I didn't read your note about SIE before = sending you the one about the IBD Article leading me to conclude that = SIE has a Saucer-shaped Chart. And, I'm having dificulty trying to = harmonize the IBD Article and your remarks. If you can give me a little = help here I'd surely appreciate it.=3D=3D=3DDonald=20 ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Friday, August 02, 2002 9:36 AM Subject: Re: [CANSLIM] Sometimes even the Pros don't know Hi Donald, I think you've actually hit on a key element of chart reading in = CANSLIM. That is, when there is a deep correction that undercuts the low = of the last base, the base count is reset and you essentially "start = fresh" with the chart. It's my understanding that this is why WON looks = at formations as they form over the previous 52 wks. In the case of SIE, = the base count was reset in '99 when the downside move passed below the = last base formed in '98. http://WallStreet-LLC.com/canslim/SIE10yrs080202.jpg=20 By August '01, you would then be looking at SIE to set up a = brand new 1st stage base as it nears its 52 wk high, in this case a = double bottom: http://WallStreet-LLC.com/canslim/SIE080101.jpg Important, as it allows you to take advantage of renewed growth = in an industry and/or company. (Assuming this is not a cyclical move) Katherine ----- Original Message -----=20 From: Donald Wallker=20 To: canslim@lists.xmission.com=20 Sent: Friday, August 02, 2002 3:48 AM Subject: Re: [CANSLIM] Sometimes even the Pros don't know Katherine ---Maybe (tongue in cheek) SIEt hasn't broken out = yet and is still working on the cup that it started back in March = 1998.---Donald=20 ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Thursday, August 01, 2002 7:24 PM Subject: [CANSLIM] Sometimes even the Pros don't know Hi All, Got a real kick out of this comment from Tim Truebenbach, a = real pro and contributor to TradingMarkets.com: "Sierra Health (SIE) hails from the leading HMO group. The = stock has stellar fundamentals, but to this day, no one I have spoken = with -- from fellow investors to people at IBD -- have been able to = describe what kind of base it has produced. It has broken out of this = "unknown" base and continues to push higher for the time being." I've dubbed this a "Lazy W"... See it at http://WallStreet-LLC.com/canslim/LazyW.jpg=20 Katherine - ------=_NextPart_000_0035_01C23ABF.9A8A13A0 Content-Type: text/html; charset="Windows-1252" Content-Transfer-Encoding: quoted-printable
Scott,
 
I would have to agree with your failing = base on=20 base pattern.
 
Katherine, would it be better to = consider staying=20 with the classic double bottom than trying to interpret a new lazy W=20 pattern?  Doesn't this relate to how WON developed the CWH?  = Didn't=20 He, Livermore and others already explore these regions and shouldn't we = learn=20 from them, or do we always question their results.  I realize that = we need=20 to learn from each other how to interpret these patterns.  It's = like trying=20 to explore too far off the beaten path,  like a child getting too = close to=20 the crumbling edge or using a 10% stop rule instead of an 8%.  Is=20 a lazy W too close to the crumbling edge especially in this = market? =20 We are told that these patterns are useful in a bull = market.  The bear=20 pops up on Thursday and Friday, then a pattern seems to fail and again = reminds=20 us to get back on the path..  Again and again, the closer I stay to = the=20 classic patterns, the less I am inclined to get into this market.  = CANSLIM=20 and WON's Technical's seem to be working for me by keeping me = on the=20 sidelines until this market speaks to me in a clearer = voice.
 
John
 
 
----- Original Message -----
From:=20 Scott = Gettis=20
Sent: Friday, August 02, 2002 = 9:27=20 AM
Subject: RE: [CANSLIM] = Sometimes even the=20 Pros don't know

here's my interpretation.
 
If=20 we have to make up a name for the pattern that sie is forming, maybe = it is not=20 really a sound base.  I agree that sie at this moment seems to be = a=20 leader in this market, but the base that it formed is too = deep to be=20 considered a flat base, and it does not have the classic = characteristics of a=20 double bottom.  To me it looks most like a base on base = structure; with=20 the first part from 4/30-6/19 - and the second part the most recent = base -=20 which was rather short.  Hey the pattern may work, in which case = ill add=20 the lazy w to my list of charts to look for.  But, in this market = where=20 breakouts are still not working why try to force it with a price=20 structure that can be labeled suspect at best.
-----Original Message-----
From:=20 owner-canslim@lists.xmission.com=20 [mailto:owner-canslim@lists.xmission.com]On Behalf Of = Katherine=20 Malm
Sent: Friday, August 02, 2002 8:13 AM
To:=20 canslim@lists.xmission.com
Subject: Re: [CANSLIM] = Sometimes even=20 the Pros don't know

Hi Donald,
 
My comments below were to show how the base count restarts, = rather than=20 looking back as far as 4 years ago at the chart and concluding that = it is a=20 4 year C&H. That means that the stock broke out of a fresh 1st = base=20 August last year, and that the more recent action, for = lack of a=20 better term "Lazy W" would be considered on its own, rather than as = a part=20 of the 4 year pattern. That makes it a 2nd stage base.
 
More specifically, the recent base doesn't meet the criteria = for either=20 a C&H or the shallower Saucer & Handle because of that odd = price=20 peak in the center of the formation. More than anything, take a look = at the=20 volume pattern as the center of the LazyW forms, it's very high. = Normally in=20 a C&H or S&H, the volume dries up at the bottom of the cup. = This is=20 exactly the opposite, showing that SIE was trying desperately to = breakout,=20 but was knocked back into its consolidation on high volume.
 
Katherine
----- Original Message ----- =
From:=20 Donald = Wallker=20
To: canslim@lists.xmission.com= =20
Sent: Friday, August 02, = 2002 9:14=20 AM
Subject: Re: [CANSLIM] = Sometimes even=20 the Pros don't know

Katherine =3D =3D  I didn't = read your note=20 about SIE before sending you the one about the IBD Article leading = me to=20 conclude that SIE has a  Saucer-shaped Chart.  And, = I'm =20 having dificulty trying to harmonize the IBD Article and your=20 remarks.  If you can give me a little help here I'd surely = appreciate=20 it.=3D=3D=3DDonald
----- Original Message ----- =
From:=20 Katherine=20 Malm
To: canslim@lists.xmission.com= =20
Sent: Friday, August 02, = 2002 9:36=20 AM
Subject: Re: [CANSLIM] = Sometimes=20 even the Pros don't know

Hi Donald,
 
I think you've actually hit on a key element of chart = reading in=20 CANSLIM. That is, when there is a deep correction that undercuts = the low=20 of the last base, the base count is reset and you essentially = "start=20 fresh" with the chart. It's my understanding that this is why = WON looks=20 at formations as they form over the previous 52 wks. In the case = of SIE,=20 the base count was reset in '99 when the downside move passed = below the=20 last base formed in '98.
 
http://Wall= Street-LLC.com/canslim/SIE10yrs080202.jpg=20
 
By August '01, you would then be looking at SIE to set up a = brand=20 new 1st stage base as it nears its 52 wk high, in this case a = double=20 bottom:
 
http://WallStree= t-LLC.com/canslim/SIE080101.jpg
 
Important, as it allows you to take advantage of renewed = growth in=20 an industry and/or company. (Assuming this is not a cyclical = move)
 
Katherine
----- Original Message ----- =
From:=20 Donald=20 Wallker
To: canslim@lists.xmission.com= =20
Sent: Friday, August = 02, 2002=20 3:48 AM
Subject: Re: [CANSLIM] = Sometimes=20 even the Pros don't know

Katherine ---Maybe (tongue in = cheek) SIEt=20 hasn't broken out yet and is still working on the cup that it = started=20 back in March 1998.---Donald
----- Original Message ----- =
From:=20 Katherine Malm =
To: canslim@lists.xmission.com= =20
Sent: Thursday, = August 01, 2002=20 7:24 PM
Subject: [CANSLIM] = Sometimes=20 even the Pros don't know

Hi All,
 
Got a real kick out of this comment from Tim = Truebenbach, a=20 real pro and contributor to TradingMarkets.com:
 

"Sierra Health (SIE)=20 hails from the leading HMO group. The stock has stellar=20 fundamentals, but to this day, no one I have spoken with -- = from=20 fellow investors to people at IBD -- have been able = to=20 describe what kind of base it has produced. It has broken = out of=20 this "unknown" base and continues to push higher for the = time=20 being."

 

I've dubbed this a "Lazy W"...

See it at http://WallStreet-LL= C.com/canslim/LazyW.jpg=20

 

Katherine

=

 

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