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Strategies & Market Trends : Charts With An Attitude; Trading In & Out -- Ignore unavailable to you. Want to Upgrade?

To: OldHack who wrote (3962)	11/22/1997 1:31:00 PM
From: Esteban	Read Replies (1) \| Respond to of 4701

OH, There are lots of good points in your discussion of averaging down. For me the key phrase is "Before I average down I forget any prices I've previously paid and attempt to look at the company anew." If you can actually do that, my hat's off to you. For me it's very hard to be objective in those cases. When I bought the stock I expected it to go UP. When it goes down to the point that I'm tempted to buy more, things have already gone way wrong, and the stock would probably not interest me now if I didn't already own it. Since the price did the opposite of what I expected originally, buying more for the same reasons is suspect. OTH,I suppose if you look at it from the perspective of what went wrong, and can identify what that was and why that is no longer going to drive the price lower, it makes sense to buy more. From a TA point of view however, the stock price now has to STOP going down and reverse negative momentum. This is not usually the kind of stock I'm looking to buy. I'm just more comfortable with sitting tight (if I was too stubborn to bail out at a small loss) if I still like the company, and put my new cash into a different company who's price is behaving more like a stock I would like to own. Opportunities abound on this thread. Thanks for your thoughts, OH. Esteban