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Strategies & Market Trends : The 56 Point TA; Charts With an Attitude -- Ignore unavailable to you. Want to Upgrade?

To: Doug R who wrote (31234)	7/24/1999 3:08:00 AM
From: bdog	Read Replies (2) \| Respond to of 79230

Scanvoodoo, long live the IL... Comkey Rev 5.6: AGI 17.375 IHF 18.438 KTO 10.500 NWPX 18.375 hybrid: AESP 3.062 AFFI 1.688 AIRM 3.000 AQIS 1.938 AVXT 4.188 CAMD 3.125 CDIC 3.625 CMIV 3.875 CTEC 4.500 HDG 3.000 ICNT 1.562 IFSH 3.312 IMUL 1.938 MAGN 3.500 NWRE 2.062 ONPT 2.156 SCLN 1.906 SRGE 3.031 UTLX 4.000

To: Doug R who wrote (31234)	7/24/1999 11:45:00 AM
From: wmwmw	Read Replies (1) \| Respond to of 79230

Any stocks that run too high too fast from its base is most likely to fall and give up part of its run up. I myself have done a lot of shorting. During a long period before March of this year, shorting on fast run-up stocks had above 90% probability of being correct. The point is at what level one can achieve best risk-reward ratio. Many traders know those fast run-up stocks would eventually fall, the point is what is the upside risk that those stocks may run before they fall. This is critical to shorting. Your model give a specific level that if violated, the stock will most likely fall to some level that also specified. And by experience it had 99% probability to be correct,(I would test this later)but your recommended actions are very conservative considering its extremely high probability. I would ( and I did) definitely short in this situation. But I would discuss the most important thing, that is, what is a level that invalidate your model? For example, if the level that QCOM cross IL is $152, what situation let you consider your model to fail in this specific case? What about its going above $160? Or breaking last high of $167? Or we just need to wait 8-10 weeks? Suppose I short after it cross $152 at $155, then it continue going up, as a trader I have two choices: wait if I firmly believe the model; cover to cut loss if I think the model may fail in this specific situation. I think there is a level, if the stock goes above this, it has higher probability to go much higher, and most traders would cover at that level. For example, $167 may be an appropriate level to cover and admit that the model has failed. Since we all know that the stock would eventually fall, but it may first reach $200 before fall back to $100, therefore as a shorter I may lose before I win, in this situation, even if the stock finally fall to $100, the usefulness of the model is still doubtful since few traders dare to stand short when the stock break $167. (I think the general level may be within 10%-15% of the total run-up). If you give this level, I can use it to test a lot of stocks in my memery. That is, if a stock cross IL but doesn't cross that level before its fall, I would consider your model valid, otherwise invalid. You already gave many stocks the validate your model. Maybe there are others that don't.