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Strategies & Market Trends : A.I.M Users Group Bulletin Board -- Ignore unavailable to you. Want to Upgrade?

To: Jack Jagernauth who wrote (8594)	9/21/1999 5:49:00 PM
From: OldAIMGuy	Read Replies (1) \| Respond to of 18928

Hi Jack, I think from my past experience with AIM and the brokerages that 10% SAFE (Resistance) on both the buy and sell sides are about right. Since these stocks can easily fall over 50% from market highs, they require a pretty fat Cash Reserve as well. Rule of thumb is you need the same % of Cash as the biggest % drop in price. Since the group can fall 50%, then it goes that 50% starting Cash is appropriate. However, as you have heard here before, sometimes it's prudent to wait a week or two between buys so as to take advantage of bigger trends. Certainly four buys in one week is probably hurrying things a bit. It's usually better to wait a week between buys as it helps to conserve cash. I've now purchased three weeks in a row (bought 8% more today at $12-1/8). Still plenty of cash left. Next buy will be at US$11-5/8 while sale will come at $16-5/8 each for about 8% of the position. I'm satisfied with the range as it will give me a 37% LIFO gain if the next thing I do is sell! Also, the range is well within the near term potential for the stock. I didn't spend much time looking at the market today. Now that I've glanced at my portf. and the indexes, I'm glad I was busy elsewhere!!! Best regards, Tom