Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Rande Is . . . HOME -- Ignore unavailable to you. Want to Upgrade?

To: Mark Konrad who wrote (32620)	8/22/2000 1:03:15 PM
From: Rande Is	Read Replies (2) \| Respond to of 57584

Mark, Thanks much. As for the Cult Post, I don't think I said that "all" buying is short-related. . in fact, I discussed the "piling-on" effect and momentum jumpers. . .and of course every type of trading and investing is going on simultaneously within any momentum play. . . .it is just that the short-covering is often the fuel that starts the momentum off the bottom. . .which attracts others to buy. And don't forget that short-sellers use TA to determine their jumping off points. . . and are often as adept as longs in their reads and scans. To all. . . The point of the post was to bring awareness of this sort of activity and the associated trading opportunities it may or may not present. This way we can all recognize the signs and keep track of Cult Heroes. As for the Cult moniker, it makes no distinction as to fundamentals. In fact, it is often a combination of strong fundamentals and/or promising technology or news that gets a cult following started. "Cult" should not be thought of as a negative connotation. MSFT, AOL, Yahoo, CSCO, WCOM even IBM once had a cult following. . . .[though few here remember that event.] Cult followings can give a stock its positive buoyancy. . . when left alone by short-sellers or when the short-squeeze wins out to upward momentum . . .the stock will often just keep right on rising [remember CMRC, RMBS, Gilder's TERN?]. . . until it hits a market decline, derogatory news, a concerted short-attack, contrived media slam / class-action suits by short-sellers or worse, the highly manipulated "analyst downgrade" occurs. . . . So tracking a stock that has a large following DOES have certain advantages. The trick is in predicting WHAT can pop the stock off its bottom. . .[monitoring money flow and volume is quite useful in such a prediction]. And of course I am not saying that these plays are still out there today . . .but am implying that this is what got so many tiny stocks into the winners circle. . . and knowing the REASON for the move is the most important step toward deciding the best play. Finally, the Cult Stock play is merely one of many trading tricks in the Hybrid Traders Bag. And of course this all has little to do with investing. Rande Is PS> This type of reasoning requires liberal generalizations.