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Strategies & Market Trends : DAYTRADING Fundamentals -- Ignore unavailable to you. Want to Upgrade?

To: ynot who wrote (3181)	8/22/1999 11:39:00 AM
From: Dominick	Read Replies (1) \| Respond to of 18137

ynot: Because there's no historical data for IPOs plus extreme psychological factors on their first day of trading, I believe the best method of trading them would be through the art of pure tape reading. As for how important it is to know if a stock is being supported via short covering depends on your trading style. If your scalping you'll play the bounce. If your position trading, you'll wait for some sign of strength and a test of that sign before taking a position. With regards to cyclical issues, I believe the top down approach is best. Depending on your trading time horizon, you'll determine the long, intermediate and short term trend of the market. For example, if the market's short term trend is in the middle of an uptrend channel, it's position is ambiguous. The market could continue up to the top of the channel or fall back to the bottom of the channel. It would be best to wait for the market to tell you what it's doing. Then you match the relative strength and trend position of each industry or group to the market. You'll want a group that's equal to or stronger than the market. Industry rotation can be determined this way. I would then carry the above strategy to the individual leaders within the strongest group. Happy trading, Dominick