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Strategies & Market Trends : Stochastics -- Ignore unavailable to you. Want to Upgrade?

To: UPAL who wrote (232)	2/23/1998 8:46:00 AM
From: Wayners	Respond to of 927

I looked at a chart of BBIOY. I would treat stochastics the same as I would any other stock. 5 day stochastics are below 20 at about 9. But since the trend is down, its not a good idea to buy it here. As I explain below, I wouldn't short it either. Its a no play for now. The volume is so light (only 5,000 shares traded all day on Friday) that I wouldn't be interested in trying to trade it. BBIOY has been trending down as far as my chart goes back (Aug 97). The longer term downtrend with the recent large gap down has got the 12 day moving average (and I'm sure the longer term 30, 50 and maybe 100 day moving averages) in a downtrend. I would normally only consider a short play, however in this case the moving average of the 5 day stochastics is so low (Its near the 20 line) and the decreasing volatility looking a few weeks forward tells me that its very near a short term bottom. Writing puts or calls here would be a good play. If you are short the stock you can write out of the money covered puts for a lower strike price ($15). If you are long you can write out of the money covered calls for a higher strike price ($17.50) . I think its going to bottom short term at around $15, then who knows--continue the long term downtrend or reverse the longer term trend.

To: UPAL who wrote (232)	2/23/1998 5:52:00 PM
From: Wayners	Read Replies (10) \| Respond to of 927

Analysis at close on 2/23/98. Anybody have any stocks to take off the list? New ones to add to replace those taken off? Let me know. Is anybody reading this? NASDAQ--Still on a hot uptrend. Narrow bollinger bands. Ready to make another strong run upwards. Looks real good for technology and small caps. AMAT- While up almost a dollar, the uptrend is looking even more neutral. Downslope on the 5 day stochastic 12 day moving average is going to hinder the advance. AMAT will continue up, I'm just not expecting a real big move. Volatility is increasing and the big move is coming, just not yet. AMZN--Up another 1.625. Going to go higher based on the uptrend--even though the 5 day stochastics over 80. Don't sell until 5 day stochastics start to deteriorate to the dowside. Still time left to buy it. ASND-- Up 1.25 again. Still plenty of time left to buy into this one. Volatility is increasing. Nice uptrend. AVM--Trend has turned downward on narrow bollinger bands. This thing is going to go lower. Time to exit long positions. Good quick short. Volatility is increasing. AVNT--Direction changed rapidly on narrow bands. Severe breakdown of $2.00. Still time to short this one. BMY--The trend is slightly down. 5 day stochastics are quite high but not showing the hook yet. This is developing into a real good short play. Look for the hook. Volatility is likely to increase. CADE--Looks like it might be time to buy back in. 5 day stochastics hooking upward. Slight uptrend. Volatility is decreasing, but should be enought time for a quick play to the upside.. CBIZ--I think its just a matter of time before this breaks upward again. Continued profit taking/consolidation now. Watch the trend carefully. The uptrend is real nice. Look for upward hook on stochastics. Moving average on 5 day stochastics is down which will hinder the amount of gains. Volatility is still decreasing but looks like its almost over. CEXP--Slight uptrend. Long term trend is way down--so makes me nervous for long positions. 5 Day stochastics look bottomed, but no hook. Volatility is decreasing so I think upward profits will be somewhat muted. Hard call with the narrow bands. Likely to get whipsawed. CFON-- Another longer term downtrend to make it a risky long. Good short over $5. Closed a little below that. The trend is nicely down. Volatility is decreasing. Short over $5. CIEN--Still no play after freefall. Severe downtrend now, 5 day stochastics below 20--no upward hook, downtrend on 5 day stochastic moving average. CKFR- CKFR reversed after 3 days at the bottom. Looks like a good short term buy here. Volatility is increasing a bit. 5 day stochastics are showing the necessary hook. The problem lies in the downtrend on the 5 day stochastics moving average and the slight downtrend on price. Those two factors are going to limit any up moves to probably around $26 to $27.. CORR--Still good short term buy on the uptrend. Look for breakdown in 5 day stochastics to take profits. Volatility is increasing as the price goes up--helping the profits along on the long side. CPQ--The trend is still up. Another good buying opportunity. Bollinger bands fully narrowed now. Volatility going to increase. CTXS--Dropped big time today. $22 worth. The quick short I recommended on Friday would have paid off BIG TIME. No play after the freefall. CYPB--Volatility due to start incresing. Narrow bollinger bands on neutral trend. 5 day stochastics no showing the full hook yet and the trend is slightly down. Bands narrow but not dropping drastically. Bands are so narrow here got to wait to see the break. Bias to the upside. DWRX--Just notice an important bearish item on this that tells me to take profits--Negative divergence between price and peaks on 5 day stochastics. The peaks have been getting lower as the price has been going up. The trend is losing gas, even though its still intact. Time to find an advantageous exit.. 5 day stochastics sitting on its lower band. Next move up--TAKE PROFITS and go elsewhere. Volatility ready to increase. EFII--Time to BUY now for upmove. The uptrend remained intact. 5 day stochastics have shown the hook. Climb aboard the train for a short ride. An early buy today would have been rewarded. GERN--5 day stochastic crossed below the 20 level. Still looking for a bottom here. Neutral trend and narrow bollinger bands make it a riskier play. Best way to play is to short at $13 1/2 and cover at $12 repeatedly. Revising buy level to the lower band which now stands at $11 7/8. IIT --Looks like a top to me. Look to take profits on long positions whne the 5 day stochastics breakdown. Look for short entry when you see the downward hook. On a slightdowntrend. IOM--Downtrend picking up again. Volatility is increasing day to day. Could be a real good short on the next runup. Gotta stay above $5. 5 day stochastics below 20 still. I'd probably cover and move onto another sure thing. Might want to try a riskier quick short with a tight stop just over $9. IRIDF--Volatility is increasing. A must to make $$$$. That uptrend is turning into a downtrend. 5 day stochastics hooked downward. That downward break bias I was looking for has occurred. Looks like an outstanding quick short, but I'm thinking longer than that is likely. JLG--Disappointed today by losing 0.50. The uptrend is neutral now. 5 day stochastics dropped today. Volatility is decreasing. Rexamine in a day or two to decide what its going to do. LCCI-Uptrend is intact. Volatility is decreasing. 5 day stochastics showing nice downward hook. I think the next upmove will be a limited price move ($15) because of the decreasing volatility. LSI Volatility is increasing substatnially. Slight downtrend now for shorting. Moving average on 5 day stochastics is down. 12 day moving average is down and volatility is increasing. 5 day stochastics are at about the 30 level. Taking into account the steep downtrend on the 5 day stochastic moving average tells me this is a good quick short. LTBG--5 day stochastics are at its upper band. Strong Downtrend. But Volatility is decreasing rapidly. Not much money to be made. No play-or write puts for downward strike of $12.50 or upward strike of $15 (riskier). LTXX--Now its below $5.00. Hope everybody shorted it. Downward volatility is increasing. Looks like its setting up for a nice short--. Don't like long term downtrend for any long positions. Stochastics have hooked upwared--but don't be suckered into buying into this hook. Seeya at about $4.50. MEDA--uptrend undergoing profit taking and consolidation. Looks like this one has potential to slip into a downtrend. Watch for a potential short for now. Its done it before. MIND--Stochastics at 20 and price at the lower bollinger band. Downtrend has developed. Look for peak in stochastics w/hook to short into. Volatility is still increasing. More downside potential. MUEI--Volatility due to increase. Slightly down today. Strong uptrend remained intact. Showing a strong downward hook now. Too risky to play further. Downward bias. NORT--downtrend and can't short it ($1.50 stock). Stochastics are less than the 12 day moving average which is bearish. NSCP--uptrend remains intact. 5 day stochastics under 20. Can start to see the beginning of the upward hook. Volatility is due to start increasing, TO THE UPSIDE. Limited price potential because of the downtrend on the 5 day stochastic moving average. Seeya at about $24 to $25 again for a nice double top. ORCL--Volatility due to increase--but its not happening yet. Uptrend now neutral and narrow bollinger bands. 5 day stochastics at the lower band and under 20. Showing a hook now. Limited upside due to downtrend on 5 day stochastic moving average. Another double top forming? OXHP--uptrend up. Nice upward hook on stochastics. Decreasing volatility. No play. PNDA--slight downtrend--no play. Under $5 now--can't short it anymore. 5 day stochastics hooking downward. PRMS--Volatility still increasing. Broke downwards. Slight downtrend and and narrow bollinger bands. I'd strongly consider shorting it still. Volatility is increasing to the dowside. Real good short play to jump on. No hook on 5 day stochastics to cover the short on yet. PSIX --I still hate this stock. Slight uptrend. Short on next peak in stochastics or at the upper bollinger bandt. Trend is neutralizing before going down. I think its a quick buy here. Sell it at $9 and short shares at that time also. 5 day sotchastics hooking upward. QWST--Volatility is peaked now. Downtrend--short now or next stochastics peak. RIG--Volatility is still decreasing but due to increase. Neutral trend and too unpredictable to play. Downward bias. SCTC-Volatility ready to start increasing REAL soon. Narrowist bands now. The trend is dead nuts neutral--so no help there. High 5 day stochastics hook about to cross the middle band and downward trend on the 5 day stochastics gives it a downward break bias. SHVA--Volatility is decreasing. On an uptrend but consolidating for next move. SMOD-Dropped badly on news. The trend is now neutral. Volatility is increasing. 5 day stochastics at the lower band. Downward slope on the 5 day stochastic moving average. Now I don't think its going to bounce back. Bottom at $25? SOCR--Volatility continues to decrease. slight downtrend and near a peak. Waiting for a break after more basing. SUNW-- Volatility is decreasing. Looks like a short now. Worried about the profit potential because of the decreasing volatility. The trend is DOWN now. The trend on the 5 day stochastic moving average is down as well. Lower volatility may decrease profits on the short. May bottom after a drop of only a few dollars. SYNT--on a strong uptrend but momentum is losing steam. Second stochastic peak lower than the first. Volatility is still increasing. Probably one more good 5 day stochastic peak left in this run--then take profits. May still want to try a quick buy. TDFX--Downward volatility is increasing. The trend is down. Trend on 5 day stochastic moving average is down. Do a quick short. TMX--Downward volatility is increasing. On a slight downtrend. 5 day stochastics hooking downward from the middle band. Quick short. TRBO--Volatility is decreasing. Neutral trend/slight uptrend.Not enough profit potential. Downtrend on 5 day stochastic moving average too to keep price moves down. 5 day stochastic is hooking down again too. TSSW--Looking for a hook to buy into. Uptrend is intact. Volatility is starting to decrease. VECO-Volatility is increasing. Good uptrend. Hook in 5 day stochastics today to buy into. Downtrend on 5 day stochastic moving average. Unknown profit potential. $40 maybe on next run or just under. WCII--Continued consolidation. Looks like uptrend is getting weary. Decreasing 5 day stochastic peaks--Working on the third one. Take profits on next runup. Looks like volatility is due to increase to the upside--take profits on that next run. WTT--Up another $1. Momentum hasn't shown slowdown yet. Look for the hook before gettin off of this hot train. Try a quick buy with a stop at the last day's daily low.