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Strategies & Market Trends : Strictly Buy and Sell Set Ups -- Ignore unavailable to you. Want to Upgrade?

To: fp_scientist who wrote (5434)	9/14/2005 6:53:06 PM
From: chowder	Read Replies (1) \| Respond to of 13449

FP, there are a couple of scenarios setting up with TS and it depends on your tolerance for risk or lack of, which would dictate your strategy. As a rule, I don't allow much room when the trade is new. My experience has been that the trades that turn profitable immediately are the ones that work out. Having said that, I notice that the 3 day low with TS is $112.71. I think I would use that as my stop target. Well, about 2 cents below that price, call it $112.69. That's a loss of just 1.8% if the stop hits, well within an acceptable loss range if you are wrong. If price makes a 4 day low, we're going down to the 20 day moving average. The 20 day moving average has been a solid support level. If it breaks, TS is a great short. Someone with a long term view might use that as their stop. It depends on how much of a loss one is willing to take. I prefer to cut losses short but every one has different objectives. When I look at the MACD, I see that it is negative. This is suggesting to me that TS does not have the energy to test its recent high. I would expect $119.50 to be a reasonable target, based on today's chart. That would be a 4.0% profit, and if you use the 3 day low as your stop, that's a 1.8% loss. So, you have reward to loss ratio of a little better than 2-1. That's acceptable. If you use the 20 day moving average as your stop, you end up with a 4.1% loss. You'd then have a negative reward to loss ratio, not a very good way of doing business. It all depends on what your time frame and risk tolerance is. stockcharts.com[h,a]daclyiay[d20050614,20050914][pb50!b20!f][vc60][iut!Lah12,26,9!Lc20]&pref=G dabum