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Strategies & Market Trends : January Effect 2001 -- Ignore unavailable to you. Want to Upgrade?

To: Q. who wrote (206)	1/15/2001 5:10:01 PM
From: RockyBalboa	Read Replies (1) \| Respond to of 289

N, I think it was a mix of three ingredients: -a quick and continuous (often >50%) decline in the last few days of december (I have posted that stocks who didn't lost much, also didn't rise that much later). For measure, I took qcharts list of weekly % losers and sorted them by volume. It also shows stocks trading at less than $2 (other than many other sites). Many of those losers had volume well over 1M and 10 day averages > 3M averages. Or that decline happening on steady volume, then a volume peak (like DSLN). -a low ratio of price/cash (like LCTO, DSLN) although this is not a necessity, as you see in other stocks who jumped without having much cash while others with cash didn't. -the absence of bad news in the preceeding 2 weeks. The decline must not be aprupt, such faltering stocks didn't recover that easily (yet), like MAXM, or BRKT. FFIV is one more example, it faltered on earnings warning at the end of december to 9.5, then rose quickly to 14.5 only to give in 66% of the bounce. There are stocks like STMP, CLRS, MAXM and several others which are at P/C < 0.5 o at least < 1 but they don't trade up as of now. That could point to more trouble lying ahead? I might believe that almost all stocks went more or less as they were simple swept up by the lack of sellers and some bouncing I notice how quick MMs have been in propping the prices up. A good half of the selections was simply gut feeling. When I found XLA at 3s or a stock like DSLN totally being sold off or CNQR at 1 on the last day of december printing endless series of red bars (daily lows) it was simply the time to snap up...that was "last minute buying", simply bidding here and there in stocks with volume and looking what is being sold to me. (Again, the qcharts tool has a current "active" list, finding stocks with volume jumps and/or price moves on the fly). Actually some stocks went even lower. XLA, bought at 3 3/4 was trading even one dollar lower in the new year same applied to TERN, unfortunately I sat on my hands. Finally it is a toss of a coin. A newsletter mentioned ADSX and VIAD and damned the former (low on cash, only 10c) while praising the latter (deep in cash, growing revenues). Message 15106547 The opposite happened. ADSX quickly quadrupled while VIAD tanked in the new year and then slowly recovered for a total gain of 45%. Finally I bought only nasdaq (or ISLD heavy) stocks, none from the NYSE and only XLA from the Curb (but XLA is that heavily traded over ISLD that it directly compares to a nasdaq stock). Here is one link which shows the superb performance of the "dogs": www2.barchart.com www2.barchart.com The more difficult task appears to happen now: Reinvest the gains into more stable stocks with upward momentum and nice financials (my early tries to invest book gains into a total dog, CLRS at 5s didn't really work out).

To: Q. who wrote (206)	1/16/2001 10:37:12 AM
From: RockyBalboa	Respond to of 289

I don't know any more what accounts for. Perhaps it was manipulation to the downside before Dec 31. Now it is up over 100%...XLA rocketing skywards, TERN, FFIV and CLRS only begin to add to the gains. None of the stocks had any earnings warnings the last days ago, knock on wood. CLRS will report soon and is poised to run in advance. But I believe I stick with the strategy to sell the high fliers now. On friday I had added a couple of stocks afterhours. Just came back from a meeting and found that other people bought them at my high bids...I'm really confused - the January effect appears to be stronger than the years ago.