Mission Statement Plus Coffee Filter 103
Mission Statement:
May I digress for a moment Freeus, and clarify my purpose in these Porching Klatches: I wish is to share [hopefully] empowering "when to sell" logic (via some of my tools you specifically requested) for exploring independent application by you [with a long position in XYZ stock,] vs. reading/buying/hearing fuzzy [logic?] sell advice such as you shared with the porch in your earlier lament. Said advisors I have suggested seemingly require unquestioned acceptance and blindly following "their" suggested Buy/Sell advice with a profit motive as the assumed rationale. Their utterances in my mind are typlified by such ambiguous phrases as we discussed earlier in our ongoing discussion such as "sell due to over-valuations" and "sell due to interest rate increases."
Now, since your original porch musings/laments to which I responded dealt with "400% profits" basically getting away from you, I am going to suggest how to use the Coffee Filter Wedgie Tecnique in a RISING STOCK PRICE scenario as illustrated by the Visual Aid in Coffee Filter 102 post.
This is by NO means an exhaustive exploration with you of the reasons to sell. I hope to explore more of those in upcoming exchanges with you as you have time. There is an old saying: "There are as many reasons to sell as there are individuals who are selling, but only one reason to buy a stock."
So, it is my sincere hope that by sharing this unemotional "guide" I am calling the Coffee Filter Wedgie Technique, that for "whatEVER reason" you, as an individual are asking yourself if you want to/should "sell," you have at least one, simple, dispassionate measuring tool to impact and support your decision process.
COFFEE FILTER 103:
Now let's start squinting at our Visual Aid with Wedgie in tow, shall we:
cmc.net
For the purpose of comparisons with other porchers who have cut out their best 1/4 pie shaped wedgie of a 5" circle, [my coffee filter was 9" in diameter, so I whittled it down to the 5" size] the "Time" axis is approximately 2.25" long.
The VISUAL on my Laptop monitor dimensions are: 7"L x 6"H
On an inkjet printer [portrait setting] it printed out: 6"L x 5"H
So grab your mouse and clutch those borders and drag them into these tolerances for sake of us being able to compare wedgies with wedgies instead of wedgies with ...let's say "termatas..."<g>
DIRECTED OBSERVATIONS AND ACTIVITIES:
Number 1:
Letter X designates my primary suggested starting point for you to place the ZERO indicator point [that place on the Wedgie where the Price and Time axis meet.] Please make the "Time" flat axis as parallel to either the bottom of your computer monitor or the bottom of your print out. Squinting here is "good enough" to measure parallelism with either of those two fixed reference points. Deal?
What's the first thing you see?
Answer: Probably price action on the arc side of your wedgie, correct?
Number 2:
Now squint again, and guesstimate the point you first see where price action on the visual FIRST EMERGES on the right of your arc? What would you guess that number of arc degrees to be? Write your answer here:___________
Number 3:
Now squint at the price action between letters X and Y
What would you guesstimate that number of arc degrees to be?
Write your answer here:_________
Number 4:
Porchers, time to adjust your wedgie<g> Slide your "O" wedgie point back toward the left along that flatish price action, trying to maintain your parallelism with your lower border or visual perameter until your imaginary line showing the underside line of price action between X and Y shows up to the right of your 1/4 circle's arc.
What number emerged on your Coffee Filter Arc?
Write your answer here:______________
Number 4-B:
Does your answer to Number 4 match your guesstimate answer to Question Number 3? Write your answer here:__________
If your two answers don't match, then either slide your wedgie again, or improve your initial "guesser" by a few degrees up or down and re-train that squintin' eye of yours!
CONGRATULATIONS!!! You have just drawn your first Trendline and found a pretty solid RULE OF THUMB to buy against in a rising market. [That would be a 22-R degree "trendline." THIS is ALSO a pretty solid RULE OF THUMB to initate a SHORT SELL against in a FALLING market]
Assignment: If price action falls below 22 Degree Trendline, is it a sell signal? Write your answer here:__________________________________________________
[As the 1040-IRS Long Form sez: Feel Free to Grab a clean sheet of paper and write out a detailed answer if you wish.<g>]
Now to Coffee Filter 104 for more Q&A exercises with our graphic and our wedgie.
Time for a reeeeeal coffee, iced tea [no sugar, please] or whatever yer' havin' break. Reconvene yet tonight if you like. Whatcher pleasure, Freeus?
Porcher-ly yours,
O/49r |
