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

To: Chandler H. Everett who wrote (7934)	1/22/1998 12:33:00 PM
From: Robert Graham	Read Replies (1) \| Respond to of 12039

Thanks for the information, Chan, This is very timely information for me since I have been considering a trial subscription to "The Chartist". Yes, those fundamental indicators are definitely out of phase. I think they can provide material to reflect on, but I would not use them in my actual market decisions. This is disappointing news. Another newsletter is the MPT by Louis Navellier which also is suppose to have a good track record according to Hubert. He uses fundamentals to evaluate individual companies. I do not know if he uses fundamentals to monitor the market itself. He does use TA. There are not many newsletters that have a good track record. What I am looking for are those larger cap stocks that are being aggressively accumulated. They are what Richard refers to as the "dinosaurs" as oppsed to what I refer to as his "grasshopper" stocks. My "dinosaur" stock would have a well-established upward momentum. I then use the options to get the volitility I need for my profits. I did this for instance with WMT very successfully. The tape helped allot to tell me when its momentum was fading as the stock "butted" up against a resistance level. Furthermore, due to the nature of this stock, it gave me several warnings and exits before retracing part of its trend. The extra plus for me was that the options were undervalued at the time of my entry which from what I understand is not out of the ordinary for a stock like this. It appears that options place value on volitility, which is very short term volitility. Many options players appear to usually have a "knee jerk" approach to trading. They are traders who are acting as scalpers without realizing it. IMO this is a form of gambling, particularily they way they play it. Even though WMT had well-established upward momentum, the option did not reflect this. The option started to reflect the stock;s movement when it changed relatively quickly over a couple day time period, in the middle of its run up to a major resistance level. So by the time it hit the resistance level, even though I would be just into profit going by the actual point change in the stock, I ended up with a much larger profit because of the change in the option's premium. IMO many losses in the markets come form those who do not know who or what they are about in the marketplace. In such cases, their image of themselves in how they are playing the market is very different from reality. Actaully, I notice this is true for many people in other aspects of their lives. This seems to be part of human nature.The psychology of people as it shows up in the markets where money is at stake and wealth is in their dreams can be very interesting indeed, and provide for many profit opportunities. So much for the market being "efficient" or "random". Success trading in the market place turns out to be as much if not more about the person trading than the market itself. This turns out to be a learning process for the new trader. Bob Graham