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Technology Stocks : CMGI What is the latest news on this stock? -- Ignore unavailable to you. Want to Upgrade?

To: Jerry Gogol who wrote (14434)	11/29/1999 11:15:00 PM
From: scanshift	Read Replies (1) \| Respond to of 19700

I agree, never short CMGI overnight. You are dead wrong when it comes to daytrading however. Read the below post that I put up over the weekend to discuss why the ADSP shorts got blown out. To: BigTex (1699 ) From: scanshift Saturday, Nov 27 1999 1:17PM ET Reply # of 2060 Always have a hard stop. Trade for point moves, not percentages. Never trade anything short overnight. Trade cheap stuff on the long side overnight. Averaging out a loser will get you blown out sooner or later. Short sellers getting blown out by blaming the media is a excuse for their own lack of money management skills. I developed these thoughts from watching a lot of traders get blown out over the years on the Chicago trading floors, and the last one, blaming the media for their own short selling failures, from watching the threads the last couple days. PART 1 Let's analyze some of these thoughts and see how they fit into the ADSP nightmare for some of the posters on this thread. First, fading or shorting ADSP between 9 and 13 is outright stupid given the high feeding frenzy that took it there on wild volume in the first place. Why? It is not going to pivot on a dime and go right back to 5. Even if it did go back, it is going to take some time. All that long volume that it took it to double digits means we have alot of long players who are not going to blow out their positions in a day, regardless of how much negative chat room hype hits the stock. Thus, to make 5 points, one is looking for an unlimited upside. Why an unlimited upside? All the volume that took it to above 10 is going to generate media interest. A lot of new traders are going to see that media interest, and say that a 10 dollar stock is cheap and they will buy it, with the idea that if they are wrong, they will lose 5 points. Thus think points, not percentage moves. Again 5 points is no big deal. That buyers mentality is the one that a lot of ADSP shorts on Wednesday got brainwashed by negative chat room hype into not seeing. Sometimes consistent short sellers forget that the vast, vast majority of traders in this record bull market only buy stocks. They do not short them. It is this bullish mentality that took us to the record highs that this awesome bull market is at. If one wanted to be, for lack of a better term, "trading stupid" and fade ADSP at 9-13, then one needed to have a hard stop. That is a stop above the market, where if the stock trades that price, one gets out of the position. The problem being, that no one should have been short ADSP overnight. Shorting this stock and holding it overnight is "trading stupid." Why, the media hype can cause it to have a overnight gap which can cost a lot more to cover. Thus my other rule, never short overnight, only short for daytrades. You do not have to worry about overnight gaps or what happened with ADSP, a "media" hype gap. Even if there is a "media" hype gap, and one was trading stupid and held overnight, one could still have covered on the opening ADSP print Friday in the 20's and learned a painful lesson about holding shorts overnight. They then could have looked for the momentum to run out, and reestablished a "daytrade short" in the 50's, and scalped it for 15 to 20 points in 15 minutes. That is a lot easier then holding out for the 5 points and a lot of pain on a 9-13 dollar entry short to start with. Thus think points. Is it easier to pull out 5 points on a 9 to 13 dollar short, or 5 points on a 50 + dollar short? How about 15 to 20 points on a 50 + dollar short? Percentage wise it is easier, and trading wise it is easier than 5 points on a 9- 13 dollar short.