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Pastimes : A Novel Academy: 56ers in Annapolis -- Ignore unavailable to you. Want to Upgrade?

To: Cornstock who wrote (1950)	11/14/1997 4:01:00 AM
From: Doug R	Read Replies (2) \| Respond to of 2403

Peg, The following posts have been deemed by yours truly as archival. The category will be "Conversations with Doug R". I am bombarded with IM "chat" and e-mail all day long and many of these chats are very pointed. When I have had a conversation that brings out any pertinent or insightful discussion, I will post it here. The following is from chats with R Schuler (a distinguished Annapolis attendee).

To: Cornstock who wrote (1950)	11/14/1997 4:04:00 AM
From: Doug R	Respond to of 2403

conversation with Mr. Schuler...Part I: RSchuler1: Evening Doug! Tiric: Russ, you're up late!!! Hello! RSchuler1: Yeah. Had a busy day organizing at home and.... lots a stuff. RSchuler1: I am trying to do a test run on the Investor Insight/Parity routine I will be following... Tiric: Is there anything you need? Tiric: P is about 300 stocks I think. RSchuler1: hehe.. Funny you mention that. After I went through the list and grabbed the 'P's, I saw that I have 360 RSchuler1: ...I may have added some I didn't mean to though RSchuler1: Since I can't connect to Investor Insight (some problem accessing their online server), I figured I try to d/l some data on a couple stocks for Parity so I can learn that process Tiric: Historical Quotes (USA) Tiric: Put that in your Favorite Places RSchuler1: Thanks. I just marked it Tiric: Use "Custom..." RSchuler1: ok RSchuler1: I wanted to say hi and I am very glad that we all got together like we did. Great idea! RSchuler1: ..I did also want to mention that P's had 300+, but you already knew that... :) Tiric: If we can all work together, the best stocks will be easy pickin's Always use 1/1/87 as the from date. RSchuler1: why that date? Tiric: It's easier to type in than 1/2/87 RSchuler1: :) ok.... Tiric: That's the farthest back AOL goes with their data. RSchuler1: ok...I'll get this ball rolling here. Talk to you soon Doug. RSchuler1: ok. Thanks Tiric: Ok. Have fun (yeah right, he says...) RSchuler1: ...Actually, I'm very eager to get started, but feel like technology is inhibiting me! (investor Insight) Tiric: II is one of the most user freindly aps that you can find. Parity is the one that is a bit daunting. Tiric: Do you need the data conversion thingee; ASCIIconvert? RSchuler1: I could tell from observing you that once you get used to it, you can really start rockin'. I just have to figure it out first. RSchuler1: nope. I got it. Tiric: Ok, great. RSchuler1: I need to convert what I d/l from AOL, right? Tiric: Yes. RSchuler1: ok.. I'm on my way Tiric: Alrightee. Get us an IL breaker for Wed. RSchuler1: ...THAT was funny. You guys are too much! Tiric: I suppose there are moments. LOL RSchuler1: Got time for another ? Tiric: Ok. RSchuler1: Great. I d/l BOSCF and loaded it into Parity. I only seem to have volume info for the first 2 months RSchuler1: Did I d/l or import it incorrectly? Tiric: Let me check what I have. RSchuler1: ok Tiric: The volume was so high in the first couple months that it was so proportionately greater than any subsequent volume that it doesn't appear as a result of the scaling. RSchuler1: ohhh.. Even when I zoom WAY in, I still don't see any volume. Is that just how Parity works? Tiric: Go back to "Groups" then to "Load A Security", then to "Temp Text" and choose a "first record" of 70 and click on OK. RSchuler1: alright..be right back RSchuler1: Yup. That did it. That's kinda wierd Tiric: What you did was remove the volume scaling used in the first few months. That brought the scaling to a level that gave the current volume more visibility. RSchuler1: ok...I'll keep an eye out for that in the future RSchuler1: MIMBO review: Once the uptrend begins, we said that the uptrend point B must be above the last downtrend point A. Does that have to happen in ONE day? RSchuler1: Using daily HIGH (not close) Tiric: It can be a double bottom or a "block" of bottoms. Tiric: Use a downtrend line that goes from the alltime intraday high across the intraday high on 10/16 as the current "major downtrend line". RSchuler1: The "major DL" is always to two highest all-time prices, right? RSchuler1: Whoops! What the heck am I saying! I mean the AT-high and the beginning of the downtrend high

To: Cornstock who wrote (1950)	11/14/1997 4:09:00 AM
From: Doug R	Respond to of 2403

RSchuler conversation part 2: Tiric: For the uptrend, use the alltime intraday low on 8/8 across the intraday low on 8/15. Then from the low on 8/15, the first accelleration follows the line from 8/15 to the low on 9/25. Tiric: Wait... SCRATCH ALL THAT UPTREND STUFF. RSchuler1: I was using 8/8 and 11/3 RSchuler1: ok..scratched... Tiric: Use 8/8 to 9/25 and then 9/25 to 11/3. Tiric: 9/25 to 11/3 represents a possible acceleration. Tiric: The funny thing about accellerations is that they always take a drop in price to establish. RSchuler1: ok. I'll get this. Lemme reload the chart. Is there a way to erase a single drawn line in Parity? Or just all of 'em? Tiric: All of 'em is the only option. RSchuler1: ok RSchuler1: ..and did you use the "microscope" tool to find the dates you mentioned? Tiric: I used the + tool to zoom in. Click + then click on the chart. I go to a calender that sits in front of me to ascertain the date. The microscope comes in handy too. RSchuler1: ok. Thanks. Tiric: The "+" tool helps to draw more accurate lines. RSchuler1: For the UPtrend, you suggested I use 8/8 to 9/25. Shouldn't I use 8/12(lower low) instead RSchuler1: I am now using the "+" tool. I like it. Tiric: Proper uptrend lines should not cross through any other subsequent bar. Tiric: Low to low with no price lower than the lin is the rule. Tiric: line RSchuler1: ok.. We're both looking at BOSCF, right? Tiric: right. RSchuler1: My data(microscope) is showing a low on 8/8 of 6.5 and a low on 8/12 of 6.25. This is very noticable on my chart which is why I was asking Tiric: Ummmm. The stock was under 4 in August. RSchuler1: Good!!!!! I thought I was losing my mind for a few minutes there. Whew! (I was on the wrong month...0 RSchuler1: That looks a lot better now. Tiric: LOL!!! RSchuler1: Damn, my trends look better now. When I was using your dates, I was actually on the wrong year. That's how I got jacked up. Tiric: Oh my!! RSchuler1: ok. Based on my major uptrend and downtrend, there is an intersection coming up in about a month. Recently, the support and the resistance has been tested, but neither penetrated (how am I doing so far?). As I recall, the stock will have to make a decision in some direction, but can I tell which way yet... hmm.... RSchuler1: I notice that we're coming off a double-bottom... RSchuler1: ...well, within the last 2 months anyway (probably doesn't constitute recently) Tiric: VERY GOOD. You are correct!! RSchuler1: to make sure I save my current screen, do I "save study" or "export study to disk"? Tiric: Export to disk. RSchuler1: ok. Thanks. Tiric: Draw a horizontal line across that bottom and check out previous activity there. RSchuler1: Umm.. I'm sorry Doug, I'm not with you. What bottom? RSchuler1: 9/25? 11/3? Tiric: 11/3. Tiric: $5.00

To: Cornstock who wrote (1950)	11/14/1997 4:11:00 AM
From: Doug R	Respond to of 2403

RSchuler conversation Part 3: Schuler1: ok... does the pattern between 6/9 and 9/9 create an inverted head-n-shoulders? Or is that just steps? Tiric: It's a historically significant support/resistance level. RSchuler1: [I drew the line]: Wow! I didn't notice that resistance before. Tiric: APCO moves in "blocks". I didn't get to that in the seminar. Blocks up are very good. Tiric: Resistance and support are the same thing depending on which side of the line the price is on. RSchuler1: Would you consider the 6/6 throught 6/9 pattern block movement? RSchuler1: Resist/Support- Understood. Thanks. RSchuler1: On 4/7 the $5 support (historical) level was penetrated. Now that it is above this level again, what bearing does it have on our "new" support level? RSchuler1: I kind of thought that we started over since penetration occured. Tiric: Accelleration is likely if the rest of the market cooperates. RSchuler1: ...lemme take a peek RSchuler1: acceleration...up? Is that based on history? So, it's kind of like a general rule? RSchuler1: ...I wouldn't have known that from looking at the chart... Tiric: The "blocks" are defined by the time periods where the highs and lows are the same. Tiric: When you draw an uptrend ine, accelleration usually occurs starting from the latest low used to define the last uptrend. RSchuler1: [off topic] When an inverted H&S is identified, is the point I am waiting for when the neckline is crossed? Is that the indicator that an upward "breakout" is likely? Tiric: I'll find an example with dates for you. Just a min. RSchuler1: ok RSchuler1: The top of my window in Parity says "TEMP.TXT - [UNNAMED]" and the File->SaveAs menu option is not enabled... How do I save it? Tiric: Hmmm. I've never tried to save any of them before but I know you can print it out. RSchuler1: oh.. Ok. In my early stages here I just wanted to save my drawn lines, etc. No big deal. Tiric: I found a great inverted head and shoulders example. IMSI. I let that one get by me recently because I couldn't watch everything. Download it and I'll give you the dates. RSchuler1: ok. I'll be a minute... Tiric: It has 2 heads and great shoulders. Tiric: 1/28/97 is the top of the first shoulder on the left. Tiric: The top of the left shoulder is what you use to start the line of what is called the "neckline". RSchuler1: That almost looks like a "double head" Tiric: The top of the right shoulder is on 4/24. Draw the line across those 2 dates and you'll see what happens when the breakout occurs RSchuler1: Is that 2(sizable) left shoulders and 1 1/2(small) right shoulders? Tiric: Notice the retest after the initial breakout. Tiric: Yes on the shoulder count. Tiric: Notice the volume after the retest. RSchuler1: RU referring to the breakout on 7/9/97? Tiric: The initial BO is on 6/24. You can see how important volume confirmation is. The initial breakout is not the place to buy. The survival of the retest on volume is the buy signal. Tiric: That's what classic MIMBO's do. They retest the initial break out.

To: Cornstock who wrote (1950)	11/14/1997 4:12:00 AM
From: Doug R	Respond to of 2403

RSchuler conversation Part 4: RSchuler1: Aaahh. Very good point. This is EXACTLY what you were trying to drive home to us over the weekend. Great example. Tiric: Almost all breakouts do a retest. RSchuler1: I was about to ask you where the resistance line was drawn, but it is the major resistance line from.... RSchuler1: 1/26 and 4/29 right? RSchuler1: I can see the initial breakout across that barrier and then the retest (of course with volume) Tiric: The dates on IMSI I gave were for an inverted head and shoulders. Not a MIMBO. Tiric: A MIMBO did occur on IMSI much earlier. RSchuler1: (about to insert foot in mouth) I wasn't referring to a MIMBO. When the BO happened in the period we are discussing (after IHS), if I follow the major downtrend and use it as the resistance, that is the BO I am referring to. When that threshold is penetrated. Am I going the wrong direction here? Tiric: You are correct. I use the term "major downtrend only for MIMBO's. Draw a line from the high on 1/3/94 across the high on 10/18/95 RSchuler1: Maybe I'm being a little confusing because I am taking this from about 7/2/97 (I'm acting like I am looking at the chart from 7/2 and trying to estimate when to identify the BO) Tiric: Go back to the entire chart and use the highs on 1/3/94 and 10/18/95. The retest was a bit excruciating. Tiric: The survival of the retest on heavy volume was the day that the price gapped up over the major downtrend line on huge volume. RSchuler1: ok. I've drawn that line RSchuler1: Damn! wasn't gapping over 20 :) Tiric: Look at the gap up from 9/26 to 9/27 RSchuler1: I see it Tiric: 1996 Tiric: This is the stuff we're looking for. Tiric: After that breakout, the stock went nowhere for 6 weeks but so what? RSchuler1: ok...when I draw the line through 1/3 and 10/18... RSchuler1: That line crosses exactly over the point where the gap occured Tiric: See how tenacious trendlines can be? RSchuler1: yes.. I'm trying hard here. Actually, it's coming to me, but I need a minute to absorb.. :) Tiric: Proper trendlines are the key. RSchuler1: At what point, if any, would I draw a line from 1/3 to 5/24? Tiric: What year? RSchuler1: Or am I just jumping the gun here. I keep wanting to draw a new line right when the resistance is penetrated. When, actually, I should be paying VERY CLOSE attention because that's when all the fun starts, right? RSchuler1: 1/3/93 and 5/24/95 RSchuler1: DAMN DAMN DAMN ! I did it again! You were talking about 1/3/95 weren't you?! RSchuler1: No, I see it. It's 1/3/94 Tiric: In a classic MIMBO, the reference prices are more discreet and obvious than a 1/4 point or 1/2 point move. RSchuler1: ok RSchuler1: Well Doug. I'd better get my 2 hours of sleep before I'm off to work here... Tiric: Yikes. Me too. RSchuler1: I have had a GREAT night with this. Thanks a lot for your help. Tiric: You're on the hook now. You better come through with your leter!! LOL!!! RSchuler1: Oh boy! I'm doing all I can!! ;^) Tiric: Thanks for your attention Russ. RSchuler1: G'nite RSchuler1: Your welcome and thank you Tiric: G'nite

To: Cornstock who wrote (1950)	11/14/1997 4:17:00 AM
From: Doug R	Read Replies (1) \| Respond to of 2403

RSchuler conversation #2 Part 1: RSchuler1: Hi Doug! Not a good shorting day today... Tiric: Declines outpaced advances. Tiric: Here are my thoughts as written to Sergio and Scott: Tiric: The "end" of the bull market has now been defined by the Dow's activity when it made a low that was lower than the March '97 low. A type of line that had not existed has been established and that line will now always be there. Just as a line is created that I call a mountain in the middle major downtrend will continue into the future, the line that I call a valley in the middle will continue into the future. When you know what to look for, you are at an advantage. Tiric: I am still going to advocate long positions until that line is broken to the downside. I am not impressed by the gain in the major indexes on Thursday since declines still outpaced advances. I am tracking the stocks brought to the threads since the seminar that fit the proper chart criteria and I hope one of the stocks uncovered will yield a long POW. Tiric: IN, you are correct in that we need to keep an open mind about short versus long as a POW so Friday and Monday activity in the major avgs. will play a big part in how we handle the POW. I suggest going one way or the other but not both ways with it. So far the market dictates (by a margin of 51 to 49) that long is the way to go. Until the VIM uptrend is broken we are still technically in a bull market. RSchuler1: gotcha RSchuler1: ok

To: Cornstock who wrote (1950)	11/14/1997 4:20:00 AM
From: Doug R	Respond to of 2403

RSchuler conversation #2 Part 2: RSchuler1: Just to let you know, I'm fairly liquid right now. I was able to sell a couple of my holdings today. RSchuler1: Since we are not getting the signal to short, I'll be ready for the next attack RSchuler1: of longs... RSchuler1: I need to find out if AOL supports ISDN... I'll be searching... Tiric: Great! I've been coaxing everyone to raise cash the last 6 weeks. The technical weakness in the market extends until the end of Dec. Tiric: I noticed you work for Platinum Tech. Tiric: I ran a TA about 2 weeks ago when I got a seperate heads up on the co. Tiric: So, how's things there? RSchuler1: I'm probably 65% cash right now RSchuler1: I'm having a real problem with this connection Doug (I didn't get your last 3 IM's). I'm going to log out and back in... RSchuler1: I can't even see my own msgs right now Tiric: I noticed you work for Platinum Tech. I ran a TA about 2 weeks ago when I got a seperate heads up on the co. So, how's things there? The IL for PLAT is up over 40 now. RSchuler1: Things are going great and looking even better in the future for us I'd say Tiric: The TA is very strong. You must be a hard worker! >>gg<<

To: Cornstock who wrote (1950)	11/14/1997 4:25:00 AM
From: Doug R	Respond to of 2403

RSchuler conversation #2 Part 4: Tiric: I used to call the stocks that I now call "attitude stocks", "usual suspects" (until a movie by that name came out). My old list of usual suspects included ABDR, SMOD, ACRT, AGTX, ABN, ERICY and lots more. The "usual suspects" list was built about 18 months ago. If one was patient with those stocks... RSchuler1: 18 months... Patience would be necessary unless you were on a wild ride all the while Tiric: JBIL was on the usual suspects list too. 18 months is actually no time at all. Tiric: The "attitude stocks I have picked in the last 3 1/2 months are killer stocks. Tiric: IMSI was one of my last "Usual Suspect" stocks before I started the 56 thread. I wasn't even on SI when I picked IMSI. RSchuler1: Agreed. They've been amazing RSchuler1: Really. That was some time ago Tiric: I got on SI in Feb. 97. Admittedly, stock picking has been very easy up until recently. But as long as the VIM major uptrend is intact, the same rules in picking stocks apply. Tiric: When the VIM UT is broken, the same rules apply on an inverse basis. RSchuler1: help me out please: VIM UT? Tiric: Valley in the Middle as opposed to Mountain in the Middle. UT = uptrend. RSchuler1: ahhh gotcha Tiric: With a Mountain in the Middle you are looking for a breakout to the upside on volume of the downtrend line as defined by the alltime high and the high of the mountain. Tiric: With a Valley in the Middle you are looking for a breakdown through the uptrend line. RSchuler1: I got that (I was reviewing my notes earlier tonight). Now we have a VIMUT.. That BIMBO makes me VOMIT.. There. :) Tiric: When you find a relationship that is valid for its inverse, it's a valid relationship. The market is symetrical RSchuler1: I'm beginning to learn that. I find myself looking for it in charts now too Tiric: The Dow hasn't had a VIMUT since 1929 Tiric: Well, actually 1927 RSchuler1: I'm experiencing history here! (if it does complete it) RSchuler1: 70 is a long time to wait.... It's DUE! Tiric: When the VIMUT line was broken to the downside, the crash followed. RSchuler1: And you had data for 70yrs to see that coming???

To: Cornstock who wrote (1950)	11/14/1997 4:26:00 AM
From: Doug R	Read Replies (1) \| Respond to of 2403

RSchuler conversation #2 Part 5: Tiric: You have to realize that even though the VIMUT now exists (it came into existence 3 weeks ago), there is nothing to say (yet) that it will break down any time soon) RSchuler1: ok. Something to keep our eye on then... Tiric: MIMDT's can last for years before they are broken to the upside. RSchuler1: really? I was taken back when you pointed that one out to me on <some> chart we were looking at then stretched quite a bit of time Tiric: Like I said in the e-mail to Scott & Sergio, " A type of line that had not existed has been established and that line will now always be there. Just as a line is created that I call a mountain in the middle major downtrend will continue into the future, the line that I call a valley in the middle will continue into the future. When you know what to look for, you are at an advantage." RSchuler1: excellent point Tiric: The troubling thing is, that line now exists. All lines are eventually broken. Tiric: Troubling if you are stuck in a "long" frame of mind. RSchuler1: yeah. I think it's good for people to understand how to play both sides though. Tiric: Well actually not all lines...just the pivotal ones. Tiric: IBM is a perfect example of pivotal lines and how they are always broken...one direction or the other. RSchuler1: IBM? I don't think I've ever looked at that chart. Tiric: WMT and HDI too. RSchuler1: Waste Management? No wait. That's WMX... Tiric: Walmart Tiric: Harley Davidson Tiric: Each chart has its own "personality" Studying the longterm chart gives you insight. RSchuler1: Walmart...Boy.. I'd like to go back 15 years and make that transaction... RSchuler1: ok.. I'm learning Doug. I' Tiric: There's too many people looking at 2 yr charts. RSchuler1: The first thing I do is look at AS LONG a chart as I have data for (don't know if that's the right approach) Tiric: If you know what you're looking for, long term charts are the only approach. Tiric: Myron found some stuff on the long term charts of stocks he had been following that really opened his eyes. RSchuler1: Someday, I'll be able to say that "I know exactly what I'm looking for", but not just yet.. :^P RSchuler1: It's going to take a lot of practive RSchuler1: errr..practice Tiric: PGDCEB's are the safest plays right now. Tiric: BIME had approx 20% gap Oct. 13, then a slow decline but seems to have hit bottom today on huge volume today followed by a slight rise. RSchuler1: I didn't understand that one in the meeting. I have it written down, but I don't got it "upstairs" Tiric: Ok, here goes. RSchuler1: Lemme have it Tiric: When a stock gaps down approx. 30 % you start to track it. RSchuler1: ok Tiric: Do you understand what a "gap" is? RSchuler1: Yup. Gap: An opening price which is above/below the previous days close due to MM buying/selling during off market hours RSchuler1: close? Tiric: Correct. Give it 3 weeks or more after the gap down. That's where the PG comes in>> Post Gap. RSchuler1: ok RSchuler1: Now where is the DEAD CAT? Tiric: Dead Cat bounce is what many people focus on but that's speculative. RSchuler1: i.e. very little (if any) increase Tiric: Correct. Very very short term and extremely uncertain. RSchuler1: ok Tiric: Now, the PGDC trends down for several weeks. RSchuler1: ok Tiric: There will always be a day after 3 or more weeks that the stock hits an intraday low that is THE lowest since the day it gapped down. It has to. That's obvious. RSchuler1: ok Tiric: The requirements that make that day a buy are that it must be a post gap low on higher volume than at least each of the 3 or more previous days while closing above (not on) the low of that day. Tiric: So XYZ corp gaps down from 18 to 12 one day. RSchuler1: ok Tiric: Over the next 3 or more weeks XYZ drifts down on steadily lower volume to an intraday low of 9 7/8 while closing at 10 that day. RSchuler1: got it Tiric: The next day, XYZ drops to 9 1/2 intraday but closes at 9 7/8 on 187,000 shares. Tiric: You look at the chart and find that 187,00 shares is the largest volume in the last 4 days. Tiric: Buy XYZ RSchuler1: Bring out the checkbook Tiric: Xaktlee RSchuler1: ok. I'll need to review that a few more times after tonight, but that is a perfect explanation. Thanks. RSchuler1: Now I get to create a new rschuler/tiric .txt file as memiors of the evening (postarity, you know) Tiric: hehehehehe! Tiric: Oh, that's spelled posterity RSchuler1: Oh yeah. It must be getting late RSchuler1: hehe whoops Tiric: Since I'm involved, I wouldn't want it spelled incorrectly. >>gg<< Tiric: Have a good weekend. I have to get some work done now. yikes!! RSchuler1: <G> Ok Doug. I'll help keep your name kleen. Uhh.. clean. :) RSchuler1: ok Take care. Thanks and I'll talk to you later