RE: Causes of Run-ups
Gary,
I've enjoyed watching your hourly-volume tracking
very much. Thanks for that. It does seem to work,
all right. I suspect the main reason why is that
it reflects institutional buying of IOM, and that
the institutions are buying IOM episodically, in
packs. Okay, so what causes them to jump together
to a buy? It's clearly not very strongly correlated
with press releases, nor is it all that correlated
with quarterly announcements and conference calls
and stupid newsletter recommendations and HG columns.
I think the institutions have already decided that
IOM is a buy, so those things aren't very important
to them any more. Instead, they wait until two
things happen. One, 'till they have some cash to invest
because they've just sold out something else, and
two, 'till, among their list of targets, IOM is the "best
buy" of the moment. I suspect that the former is
more important than the latter just now, which helps
to explain why IOM seems to move more when everything
else is on a dip, i.e., the institutions take their
profits on the big issues after they've run up a
bit, then they turn that money into IOM shares for
longer-term accumulation.
The nice thing is that that pattern should continue as
long as the market is up or flat, and if the market goes
sour, then IOM should be hardier than most other
issues because it is in a big earnings growth phase
at the moment unless a really huge depression hits
and takes out PC sales big time. In other words,
IOM is somewhat crash-proof.
Just some thoughts. Any comments out there?
Cheers, Tom (long IOM) |
