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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA
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To: J.T. who started this subject10/18/2000 3:33:18 PM
From: dvdw©  Read Replies (1) of 19219
 
It's all a matter of perspective! The market is always about Supply and demand for shares. This latest series of events popped several bubbles that the MOMO players created. Another one is in the works I'd like to share how I see it working using two stocks BLDP and ENER as an example. Let me know what you think!

Call it the difference between Speculation and Investing.
Scenario, guy comes on ENER board and states his charts tell him BLDP is better than ENER (charts do show this) follow the thinking. Here is my reply to the guy.

Your post on the ENER and what you conveyed through it prompted these thoughts;
1. As a chartist you see the market as securities conforming to patterns and trends manifested
in the lines your viewing.
2. One can look at five different charts and assess which stock of the group is best performing,
but the chart never tells you why.
3. Further due diligence will often provide the fundamental backdrop which provides the rationale
for stock performance; at least it should.
4. Movement in stocks is always based on supply and demand for the underlying fundamentals
and financial data supporting the stock.
5. The character of those fundamentals are where often the disconnect happens. For instance
BLDP is Hot with a great stock chart, I agree 100% with that view. But I would posit that the
stock (BLDP) is a momentum stock based on the overall ignorance of those who bought into it.
No different than the Internet stocks hot last year. In other words the stock has been set up by
MOMO players for the same treatment as all other Bubble stocks. It's primed for a crash unless
and until several things happen.
A. The Float is absorbed by institutions, Currently sitting at 10% of float.
B. The Company becomes something more than a story stock for MOMO players.
C. BLDP is able to use it's bank account to become something more than it is today.

My contention is that BLDP is simply a product of another bubble forming in the market, where
money follows money bidding up supply until the bubble created bursts.
As a Long term investor who buys and holds, I rely on a different kind of underlying due diligence, one more substative than following a trend not supported by any reality except speculator greed.

As a long term investor I follow money much like a momo player but instead of looking at how money flows into a stock I watch how it flows into a company. That fact tells more about future performance than any amount of speculative money flow into a stock can.
ENER is telling the market a story,but few are listening. I do not fault them because I know that in
the case of ENER it's story is like a whisper cought inside a gale wind at this time.
There are fundamental differences of perspective at work here. One is driven by speculators the other by Investors.

It's all a matter of choice and perspective.
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