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Strategies & Market Trends : The 56 Point TA; Charts With an Attitude -- Ignore unavailable to you. Want to Upgrade?

To: ivan solotaroff who wrote (9466)	12/19/1997 12:10:00 PM
From: Esteban	Read Replies (1) \| Respond to of 79383

Ivan, I couldn't have picked a worse day to buy in before the open like I did with SGI. However, I think things worked out pretty well as far as risk control goes. I lost 1/8. I think a signal day truly does reduce the risk about as well as anything can. The volume is the key. There just aren't many sellers left on these beaten down PGDCEB stocks, at least until there is a bounce. Re: Hindsight being 20/20, I would advance today as a reason not to play the kitty until 9:31, or even 10:30, 11:30, the next day. Ivan, this might actually increase the risk, and certainly reduce the potential reward. After a signal day, these stocks are more likely to gap up than down. If they don't move strongly at the open, the chance of success is smaller than if it does. So a next day entry point would be at a level higher above the stop loss point if the stock moves strongly, or if it doesn't the signal has become a bit suspect. I think it all comes down to the odds. Time will tell where the best risk/reward ratio lies as far as entry points go. The big question for me right now is how to factor in market meltdown days that become signal days. If today's volume on SGI exceeds yesterday's, it's a new signal day if it moves off the lows. Do we still consider it a valid signal day when the reason for the signal is obviously not stock specific? Esteban