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Strategies & Market Trends : Stock Attack -- A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: ViperChick Secret Agent 006.9 who wrote (5235)	1/28/1998 12:03:00 AM
From: Chris	Respond to of 42787

time to rock n' rolll.. staying up all night to get some trades going... dow on the weekly is getting stronger... not as strong as naz weekly but it's getting there..

To: ViperChick Secret Agent 006.9 who wrote (5235)	1/28/1998 12:04:00 AM
From: Chris	Read Replies (1) \| Respond to of 42787

IBM CLOSED BELOW 200 MA

To: ViperChick Secret Agent 006.9 who wrote (5235)	1/28/1998 1:37:00 AM
From: Robert Graham	Read Replies (1) \| Respond to of 42787

Thankyou for your feedback on my comments. I do try to spend time thinking through my posts before I make them, but I do not always give myself that time. So I am happy that your have found them to be worthwhile, aside from my creative spelling. I think it is a good idea to think about the different players that can be involved in a stock and think about what would motivate them to buy and sell. However, you should never let this distract you from the technicals of the stock and through them what the stock is revealing to you about where it wants to go. Thisis the way some technicians think of TA: its the price telling you where it wants to go and your job is to allow the price to communicate this to you and notlet anything get in the way of this like your preconceptions or desires. Getting back to the user profile of a stock, one way of categorizing the players in a stock is by time frame. Another is by what event would help determine their participation in the stock, like a move down of the stock to its 200 day MA. Many very short term traders would make this play, particularily on a stock that has in its recent past demonstrated strength. Also from my own observation, it appears to me that stock prices are more apt to bounce on an upward sloping MA. This is if course is the result of the uptrend that the a stock was in before its fall from the grace. I personally have never played a bounce before, but I see it is a popular strategy, and this is some of the criteria I would use in my choice of stock to play this way. This also leads me to an interesting observation: there are apparently many technicians out there that trade in the market in order to make this not an uncommon observable event on stocks. Also, from my conversations with others including a NASDAQ MM, the market makers themselves use TA to manage their inventories of stock for instance. Also, I am sure they availe themselves of what the price can tell them through the tape. Have you noticed some of the symptoms of a bounce in the making? The price breaks through its 50 day MA and perhaps after a partial retrace continues its way down to its 200 day MA. As the price nears its 200 day MA, volume increases along with the speed of the downtrend. When the price reaches its 200 day MA, it then reverses direction. This part is key: the price moves up still under volume. At this point, the stock usually does not revisit its 200 day MA at least in the immediate time frame and travels up to an overhead resistance. It is important to watch what happens next. If the price moves back down, does the volume ncrease once again or remain the same or decrease? What is the A/D indicate during this sequence of events? Is there a divergence in its OB/OS indicator with respect to the price retracing back to its 200 day MA? If the volume drops as it moves back to its 200 day MA, but then is not followed by a reaction to the upside under higher volume, it has been my experience that the price may end up moving down past its 200 day MA where its volume can increase on the downside. Has the stock made new lows this time around? You have to be careful here because sometimes the traders and MMs attempt to hit stops that may be waiting on the other side of the 200 day MA that has provided support to the price of the stock. This is where you see the price graph move down past the 200 day MA to end up back above it. Once again I think that volume is important to watch when this happens, and how long and how far the price stays below its 200 day MA. I have not made bounces off of the 200 day MA a study, but this is what I have observed so far in what I would see as a more classic bounce situation and also what can happen. If anyone has other observations on this topic to add, please post them. Bob Graham