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Strategies & Market Trends : Analysis Class for Beginners -- Ignore unavailable to you. Want to Upgrade?

To: MechanicalMethod who wrote (1328)	4/29/2001 5:31:42 AM
From: Arthur Tang	Read Replies (2) \| Respond to of 1471

Thank you for the two previous interesting posts. Remind me of the stop loss orders being a tip of to your broker, how to dip down to take your stock and make some money. This is not mechanical but a huge temptation especially when the market is to promote fear to buy back stock. (Mareket is promoting greed at this moment going into MAY, 2001.) Then, the "specialist trap" is explained in technical analysis, when it only involves lot(100 shares) trades. The minute, large trade(larger than monthly average) occurs; specialist may be involved(they only trade 7% of the overall market), but it is really the brokerage bull pan that is involved(they trade the rest of the 93% of all trades on NYSE). The lack of understanding of actual process of trading on Wall street, make these mechanical methods of technical analysis a fool's paradise. Specialist's or brokerages' shorts are a measure of the liquidity on that particular stock. But, alas, it is also the resistance in technical analysis. The shorts should be about five days of daily average volume, to be sufficient; if there is a run(sell) on that stock. Otherwise, the specialist may have to move it to sell more shorts, before he is comfortable(selling pressure could be 3 days in a roll). I am but a proponent of understanding how things are done on Wall street; then you can analyze the situation to make some easy money. Simple technical analysis will handle most of the days. But we have to be on the watch for large trade which matters in the next two years. AOL and DELL came to mind, right the way; if you look at their 5 year charts, and the huge trades(10 million shares?) that plotted the present course(curve). You will see my point. Good luck on your investments. I feel obligated to point out the loop holes. At least, we are temporarily out of all science fictions of investment strategies.