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

To: wmwmw who wrote (31244)	7/24/1999 5:20:00 PM
From: Doug R	Respond to of 79230

Wang, From your perspective, falling behind by 20% in the short term would be too uncomfortable for you. From my perspective, 20% is no big deal since I have confidence in the method. I would very likely add to my position after 25%...with mouth watering as I did. Using the words "shoot to 200" implies that you would allow emotion to enter your trade...not a good thing. On QCOM, the ACT is not moving up very rapidly at all. It's at 100 in 10 weeks. I could easily wait several more after that if necessary. One aspect you may have overlooked is that once the price reaches the ACT, the bounce up makes a very good long trade with a % gain that is also targeted by the model. A 40% drop in a stock also reverts to a reciprocal 40% gain. With the potential ~100% gain (after compounding) QCOM is offering on 2 moves, 20% is not much to withstand for me. It wouldn't matter if QCOM went to 200 in the meantime because when it's all over I get the same result. I have to be confident in it...I've only see it truly fail once. It happens on so many stocks that the one failure would be far outweighed by the successes. If the model fails for you it would only be because you set an arbitrary limitation thus altering the model or buckled under to emotion. I'll take a look at those charts and let you know if the model was applicable to any of them. If there is no ACT as defined by the model, there is no trade using it. Doug R

To: wmwmw who wrote (31244)	7/25/1999 12:37:00 AM
From: Doug R	Read Replies (1) \| Respond to of 79230

Wang, RNWK: ACT originated on 2/9/99. Close above IL on 4/13 and 4/14. IL value on 2nd day over IL on 4/14...112 1/2 with stock price high of 131 7/8. Returned to ACT 5/25. Value of ACT that day was 60 1/2. 131.875 to 60 1/2 is 54%. Fell below and messed around with it some before the RR to 97. 60 1/2 to 97 is 60%. Model verified. 7/20 low was right on the ACT. AMTD: No ACT. YHOO: No ACT. AMZN: ACT originated on 11/11/98. Closes above IL 1/5 thru 1/20. You woulda hated this one. IL value on 2nd day over IL on 1/6...122 5/16 with price at 137 7/8. Returned to ACT 2/17. Value of ACT that day was 92 1/2. 199 1/8 to 92 1/2 is 53.5%. Began RR almost immediately climbing to 142 3/4...54.3%. Then a funny thing happened...AMZN had one pullback after RR and went BACK over the IL on 4/26 and 4/27. You woulda loved this one. IL value at the time was 207. Subsequent drop reached the ACT valued at 131 on 5/14. It appears there may be no RR upon the 2nd violation of the same IL. UBID: No ACT EGRP: No ACT BCST: ACT originated on 12/3/98. Gaps over IL and closes over IL 1/8 through 1/13. IL value on second day over IL...75 with price at 142. Returned to ACT 2/10. Stopped 4 1/4 points short of ACT with price of 50 3/4 before RR. ACT value that day was 46 1/2. 144 3/4 to 50 3/4 is 64.9%. RR took it to 101.5...50%. It too returned to over the same IL after a pullback from RR on 4/5/99. 2nd day over the IL, the price high was 177 1/4. Returned to the ACT again on 6/15. ACT value that day was 89 1/4 which was also the low price of the stock that day. BCST DID have a 2nd RR after the 2nd IL violation bouncing to 145. % of drop on 2nd violation...49.6%. RR was 62.4%. It went 65%...50% the first time. Looks like it made up for the difference between that drop and bounce the second time. Well, that's enough for me for the time being. It's a stock that goes straight up and doesn't drop back that invalidates IL/ACT/RR. MSFT would fit that bill. The ones from your list so far have worked pretty well. Doug R