| Great Posts
Date: 06 Jun 1997 10:13:16 EDT
From: RMille2282
RT-
DSWLF is a special situation, as you may know. I believe Nam Tai is still
selling the remaining shares of the 10% of DSWLF it bought last year on a
low-risk gamble, never meaning to hold it long term, but to make some fast
$. So, we've just come through the earnings play and now volume is drying
up as we re-approach the 50-day MA. I'm sure Nam Tai's sales have something
to do with DSWLF's action recently.
The market makers know they have the power to jerk this thinly-traded issue
around, and we may see them lower the bid real fast to chase out weak hands
before bringing it back up. This could happen in the next couple of days.
As long as fundamentals don't change, and they're not ( except for the better,
with the expansion of production ), I'm still looking for $30 by the end
of the year. I'm not even concerned.
By the way, when China takes control of Hong Kong soon, all of these HK companies
( like DSWLF ) will be nationalized by China, and investors will lose all
their money. Do you think this has something to do with DSWLF's weak knees,
also?! China's not going to do a thing, you'll see.
Bob Miller
Date: 06 Jun 1997 10:39:54 EDT
From: GMalloy
Groups or markets CAN stay above 70% for a long time. Bullish percent speaks
of DIRECTION-NOT AMPLITUDE. It may even play to look for new breakouts in
these areas, especially of the CANSLIM variety, as they may still work out
very well.
If you then get a reversal back BELOW 70%, it is then time to be very careful.
Experience has taught me that you will want to sell any issue that gives
a P&F sell. You may want to sell 1/2 of any position inthat group EVEN
WITHOUT A SELL SIGNAL BEING GIVEN. This is because that reversal is an tremendous
leading indicator.
So remember, it is the reversal, not the level itself that is important.
Also, I would be more interested in trying to stay with stocks in groups
that are closer to the 50% level than the 70% level. Yet so long as the group
is in a column of X's, it is the stock itself that is paramount.
Hope thsi helps. It is a critically important subject and I have been meaning
to discuss it.
As always...One man's opinion
GMalloy
Date: 07 Jun 1997 14:55:00 EDT
From: GMalloy
My sell rules are pretty simple. I sell 1/3 if the stock advances 50%. That
takes 1/2 my original $ off the table. If it moves up 100% from initila purchase
price, I sell 1/3 of what is still left. I now have almost all my own money
off the table. At that point I simply use P&F stops to get out of the
rest.
Note, I typically get out of some of any stock that hits the first trading
stop, usually 1/2. In a BULL CONFIRMED market I may give it a little more
leeway. If a stock violates the bullish support line, I'll be long gone.
Also note that if a stock reconsolidates and gives a new buy signal, I may
buy more again, even if I may have sold some cheaper on the way up. It's
a hard pill to swallow on occassion. Yet as O'Neil says-"Opinions are often
wrong, markets never are."
As always...One man's opinion
GMalloy
Date: 09 Jun 1997 11:39:31 EDT
From: Coolcat895
>>In IBD they run a small box that denotes stocks falling in relative
strength. Why not a box showing 'rising' relative strength?<<
Why not? Quite simple...WON makes big money on the institutional information
services his company provides. If rising RS was shown in the IBD, the small
investor would have the opportunity to buy rising RS stocks at the same time
as the institutions, limiting them in their ability to accumulate stocks
before the attract the public eye and the price starts rising, e.g., when
the RS rank hits 80. Everyone would just start looking for rising RS stocks
reported in the paper rather than saving back issues of the IBD or DG and
manually compiling the RS rank on all the stocks, which is too much work
for most investors.<<
Actually there is a source of rising RS information in IBD. It's the percentage
gain or loss vs the 10 week moving average which is reported in the far right
column in Wednesday's issue.
Generally speaking, in an upwards biased market like today's, a rating here
of +20 will indicate stocks whose RS is rising. In a bear market or correction,
any stock with a positive rating at all will be increasing in RS.
Date: 11 Jun 1997 14:15:22 EDT
From: Fairbank J
<<question....how do you let your WINNERS run and still adhere to WON's
early advice to take your 25% profit off the table? It confuses me that one
time he says to take your 25% and look for new winners, and another time
he says let them run. >>
This is a very common question and while I can't speak for O'Neil I can offer
you my thoughts: Your question is comparing apples and oranges because there
are two different classes of stocks.
The first class are the average CS stocks bought in a typical market. These
are the stocks you take your profits on, whatever your profit-taking strategy
is... 20%, 50/50, or Captain Moonbeams astral projections. This is your bread
and butter. String together a couple of 20+% profits while limiting your
losses and you will do very nicely.
In a higher class are the New Leaders. These are the stocks you try to buy
at the beginning of a new leg up in the market. With these stocks you are
going for larger profits so you can accept larger losses; you don't have
to limit your losses to 7% because you aren't limiting your profits to 20%.
These are stocks with enormous long term potential that you buy, give them
some room, and watch them run hoping to hold for at least a year. Of course
you still need to have stops but you can put them further out. These are
the stocks you are swinging for the fences with, this is where the real money
is made, this is how you can string together a few triple-digit years. Note
that New Leaders come along less frequently.
<<I'd be curious whether to get back into "sitting on cash" you pulled
the plug sooner rather than later on a few that hadn't moved as quickly as
you liked.>>
My new leaders were stopped out even with the generous stops I gave them.
They put the spank on me. But that's the way the game goes. Even though they
rudely handed me some heinous losses I still feel these are the names and
I will establish positions in them again when the opportunity returns whether
it be in 5 days or 5 months.
The combination of my new leaders collapsing and the markets new highs on
low volume (can you say distribution) induced me to take profits on my regular
stocks that were near or at the 25% level and nearing their target prices.
However rather than a top down approach were I felt strongly about the direction
of the market, most of my individual stocks either hit their stops or their
targets and I haven't found any compelling replacements... leaving me with
a lot of cash. I'm still holding a few regular stocks that haven't moved
and I see no reason to sell them until they hit their targets or their stops.
The only positions that are looking interesting to me here are on the short
side.
Fairbank
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