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

To: Raymond James Norris who wrote (13311)	2/11/2000 9:51:00 PM
From: Diane Leadman	Read Replies (2) \| Respond to of 14266

Raymond - I am very happy to see you posting here. I have just, in the past 1-1/2 months, started to learn about TA and I would love to communicate with you about it and maybe you could push me towards some good books on the subject. I do have "Technical Analysis of Stock Trends" by Robert D. Edwards and John Magee. If you would like to, please e-mail me at leadman@uswest.net. Thanks - Diane

To: Raymond James Norris who wrote (13311)	2/11/2000 10:31:00 PM
From: Dennis K. Showers	Read Replies (2) \| Respond to of 14266

<First, one day does not make a trend.> I agree. The hammer formation only says that the current trend should end. As I said we can either trend sideways or we can reverse direction. In addition you said the hammer was on weak volume. That is not true. The actual hammer was yesterday and it was on HUGE volume. Today's confirmation was on weaker volume which is not as important as the hammer day and the day preceding it. Consider that the bulls were on the run and decided to turn and fight. There was a hell of a battle that took place yesterday and the day before. An exchange of millions of shares took place. At the end of the battle the bulls had pushed the price up to yesterday's close. Today the bulls were in control. The direction has turned. Every bear yesterday is now loosing money. <this would only be a first step in a long process to repair the chart.> That is correct, but many times after a hammer formation the first step is the beginning of a real race. Is it possible that there are still many shares short and that these shorts have just erased much of the lose that they had just one month ago. If the price starts to rise don't you think that those shorts may want to cover now? If they start to cover the price may rise quickly. If you were a shorter of stocks would this be a good place to try and establish a short position. I don't think so. I take your point about the broken trend line very seriously. You are correct that the line is now serious resistance. The more times it fails, the stronger it becomes. There was no hammer on February 1. The pattern is a three day pattern set up by a dramatic down day on which the stock opens and then moves steadily down throughout the day and closed at it's low. That was Wed. In fact Wed. was just a continuation of Tuesday's downward movement. The day following the huge down day the stock gaps down (ideally) and falls considerably and then recovers to close near it's open. It does not matter much if it is above or below the open.What matters most is that the shadow of the candlestick is at least 2 times the length of the real body. The third day of the pattern is the confirmation of the pattern. The stock opens (again a gap up would be nice) and then moves up throughout the day and closes at it's high or near it's high. The pattern is complete. The only thing we had on the first was the shadow that was twice as long as the real body. An example of a hammer formation was on March 23, 24, and 25 of 1999. You will note that there was a near hammer formation on March 1 but there were several things wrong with it and it failed. For today's confirmation I would have liked to have seen greater volume and a greater increase in stock price to give a stronger signal. But it may have been weakened by the bad day in the rest of the market. The fact that we seemed to have stopped falling on such a down market day is also positive to me. I have a question. I have often seen the term 'sku' used but I have never seen its definition. It's driving me crazy. Can someone enlighten me. Thanks. Whitetail

To: Raymond James Norris who wrote (13311)	2/11/2000 11:04:00 PM
From: Apakhabar	Read Replies (2) \| Respond to of 14266

Hi Ray, I appreciate your detailed posts and I hope you are thick-skinned enough not be insulted by criticism from anyone, including me, although my criticism is not at all personal. I'm unfortunately ignorant of how to link a chart to my post but I think anyone can go to BigCharts and print out a four-year logarithmic chart for THQI and see what I'm talking about. The basic problem with your four-year trendline is that it fails to include the low in Sept. 1998. To me it's apples and oranges. Why not draw the straight line up from the low of March 96 and connect to Thursday's low. You'll find this line also provided perfect resistance in July 96, April 97, Sept 98, and Thursday. A parallel top line does not hit all the tops perfectly, but it's close; certainly a top line that begins just a little above the high in October 96 and connects to the recent high would perfectly include highs made in Jan.98 July 98, Dec.98 and Jan.99. The only highs that exceed it are the brief highs made just prior to the loss of the WCW license in March 98 and the day of Q1 earnings two months later; the two highs that don't quite reach it are in October and December of 1997. Keep an open mind. Your trendlines also miss highs, and have significant breaches (yours are on the low side). Another area that you deem important that doesn't seem to be is the 200 DMA. I come to this conclusion with a great deal of surprise because I rely on this indicator with many, many stocks and have found it to be extremely useful. But just look at the 200 DMA plotted for four years for THQI. Look at it! It's awful. It provides very good support in June 98, Feb 99, May 99, and in December 99. That's four strong supports. (August 96 is unclear and too long ago to argue over.) The price almost reached the 200 dma in August 97 and in March 98, so that can count as another two supports. But Ray, during the same four years there have been six major breaks below the 200dma. That's six to six. That is coin-flipping. Now here's an interesting thing. Plot a one-year moving average. Near-perfect support in five major lows, six if you count this week. Now I am not making predictions based on this data. I am simply saying that this data exists and you have to perform statistical gymnastics to assert that over this four year period the 200 dma has more relevance than the 365dma. I have traded THQI for almost three years, and I have been a full-time trader for a year, so I know intimately what has happened many times when THQ has tested the 200 dma insofar as increased activity and interest goes. But is it, for THQ, a support level? The data says, emphatically, just sometimes. What do I conclude from all this? Only what I've been saying lately: the "story" for the stock is complicated. For the second time in four years the fundamentals have been challenged. The first time (loss of WCW) was much more serious. Yet the reaction from the street this time has arguably been more severe. You can't dismiss the fact that the large short position complicates things. So do options trading, which didn't exist for THQ in March 98. Your most recent chart showing this current downtrend is compelling. And I don't like to argue with the tape. I can understand the idea that the non-retail buying now is only short-covering and, when it subsides, the stock will fall further similar to JAKK falling closing at 14 last week. And I don't like some of the secrecy I see in THQ regarding the details of their JAKK agreement and I don't like not knowing whether or not THQ has rights to XFL games. But because the situation is so unclear, I can't agree with you that the major long-term trend has been broken. One thing I saw today that impressed me a lot was when a guest on CNBC was asked, by email, if he thought THQ was undervalued. This was around 1:30 and everybody and their mother was on the bid at 18 3/4 and only MASH and PIPR were offering at 18 13/16-- but MASH was selling a seemingly inexhaustible amount of stock. This guest said he did NOT think THQ was undervalued and he talked about the short shelf-life of games and he did not recommend the stock. Within a few minutes all the bids had been hit and only SELZ (who recently initiated coverage) remained. But they stayed there and bought everything. They were not afraid to buy when everyone else was afraid to buy. (I do not believe they just filling an order.) And eventually the tide turned and the stock closed up. That's just a snapshot, of course. But like everything else we've been presenting here, it's information.