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Non-Tech : MB TRADING
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To: Nazbuster who wrote (1857)11/8/1998 6:05:00 PM
From: TraderAlan  Read Replies (2) of 7382
 
Daniel,

Depends on your need for speed. One way I control my losses is switching to slower stocks when I hit a drawdown.

The ones you mentioned sometimes have good trading properties. If you haven't noticed, MER's done almost 100% in the last month.

I'll make an odd statement but I think NASDAQ's a more honest market when it comes to the technicals. Might be because NYSE stocks are monopolized by a single specialist. If they are sharp on TA (and many are), they'll intentionally drive price through violation points just to grab the volume because they know the TA types will show up there. That type of focused manipulation is less likely on NASDAQ since MM motivations are often in conflict.

I think TA works with slow stocks and fast stocks and in all time frames. But I wouldn't use it on thin issues due to the chance of manipulation and wide spreads that can trigger buy/sell signals all by themselves. Utilities show real nice support/resistance and trend/range movement. So do charts of mutual funds, which are baskets of stocks and other financial instruments.

Generally I'd stay away from real slow days on any issue. The noise to signal ratio is way too high to make any sort of price prediction. Even MSFT and DELL can get real dull during holiday trading.

Alan
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