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Microcap & Penny Stocks : TGL WHAAAAAAAT! Alerts, thoughts, discussion. -- Ignore unavailable to you. Want to Upgrade?

To: Ong Dien who wrote (36354)	3/14/2000 6:52:00 AM
From: Tom Allinder	Respond to of 150070

People ask me "what is wrong with this stock?", "how come this stock ain't movin up?", "what happened to XXXX; is it finished?" This is why stocks do not move up every day: When stocks are moving up, they move up on BUYING pressure. In order for a stock to continue to move up, the buyers must outnumber the sellers. After a stock has moved up a significant amount, people begin to take profit. At some point, the sellers will outnumber the buyers. In the case of a big run-up in price, you will end up with a big selloff at some point which will be helped along, and in most cases started by the market makers of the stock (they need shares). The stock will settle back to a lower level. Once the stock finds this level (called the base) it will remain there until most of the sellers are done with the stock. These sellers are generally people who bought at this base level and get bored with the stock and those people who bought at a higher price and to a lesser extent, those who get bored who bought lower. As the selling gradually ends the volume on the stock will decrease as well. Once the selling has finished, the stock will be ready to emerge from the base and head higher. The move to a new high is usually done on big volume because you will still have some selling as the stock moves up (those who bought too high during previous run-up and want to get out even). It is simple... people will become better investors and traders if they understand the mechanics of stock movement. Without this understanding, people have unrealistic expectations of stock movement. Most people in this market are chasers and momo players... everyone is making lots of money so little effort is needed to make money right now. However, people could maximize profits and avoid unnecessary loses if they would take time to learn how a stock moves. All the information about where any particular stock stands is readily available on a 60 or 90 day bar chart that shows the stock's open, high, low and closing price as well as the volume. To a lesser (and much less understood) extent, the Level 2 will show you where resistance and support levels are. TREY: Had a huge move and needs to shake out sellers and build a base before moving higher. I do not expect this process to take longer than a week. IDCP: Tanked after a big move... needs to build a base before heading up again. Much less is known about this company so the process could be a day or two or several weeks. Tom