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Technology Stocks : THQ,Inc. (THQI) -- Ignore unavailable to you. Want to Upgrade?

To: Sigmund who wrote (13161)	2/10/2000 3:40:00 AM
From: Raymond James Norris	Read Replies (1) \| Respond to of 14266

Sigmund, It seems to me that what happened yesterday was that the stock was rallying and BF decided it was time to pick up the phone and make four phone calls. That action cut off the rally. So to me this falls outside of the realm of TA. Yes, you're probably thinking that had he not done anything, THQI would be above the broken trendline, right? Timing is everything and I don't believe his call caused the stock to stop its rise and fall. The information was already known by others besides the institutions - perhaps relatives of Farrell, friends, competitors, etc. Notice the strong decline from the high of $39 before the rally to $24. The Farrell matter just spread the work quicker. In TA, broken support becomes resistance. Often when breaks occur, a stock will rally back to its support to try and recover. And almost invariably, it fails. We don't know when Farrell placed that call but regardless, the chart is as it is. If you revisit the chart I provided and closely examine this week, you'll see the rally, almost to the dot, rallied right to its old trendline. Why? Psychology and traders. Even though the trendline doesn't exist on charts, it does exist in peoples' minds - and they might not even know it. The rally attempt also hit a short term moving average - the 18 DMA - and turned away. The 18 is the most popular average for short term swings. Graph it and you'll see that every rally ended at that average. Again, it's just too much of a coincidence to believe that somehow Farrell's call "just happened" to occur at the time which would make the rally fail at the trendline and the 18 day moving average. Let me give you another example: you may remember Oxford Health. It reported in October of 1997 that its books were cooked. Now, no one knew that such an announcement would come. The company decided to release the news over a weekend. On the Friday of October 24th, 1997, Oxford closed below its 200 day moving average for the first time in 12 months. Any chartist would have been long gone from that stock as closing below this major average is a big no-no. The news was released that weekend and when the stock opened on 10/26, it was down some 70%. Here's a chart to illustrate: stocktrendz.com Logically, was the news announcement "outside of the realm of TA" since it was totally unexpected and just happened to be released that day? Or was the chart showing weakness before the announcement that traders could have picked up? You see, here we have a similar problem. It's not possible to say it was "outside the realm of TA" because TA merely reflects what everyone knows. And I can assure you that there were others who knew about this before Farrell made the call. Their actions these past weeks have given many the hint that something wasn't right. It is likely that the rally was genuine and then people who knew about some possible problems sold into the rally, sending the stock down. Then the institutions found out and sold like hell today. Conservatively Yours, Raymond J. Norris