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

To: Wayners who wrote (386)	3/26/1998 11:31:00 PM
From: Wayners	Respond to of 927

I have been reading your post on the Stochastics thread. I am new to technical analysis and was hoping you would have time to answer some Q's. 1) I recently shorted AMGN at 61 1/4 based on the top bollinger band coming down hard and the stochastics appearing that they are going to cross. Based on todays numbers and your post I am thinking I made a poor choice. In your opinion should I cover ASAP? While AMGN could drop, I prefer only to trade with the current trend--using a short term moving average. Since we are dealing with a really volatile stock, its a good idea to go with a short term moving average like a 10 to 12 day basically to give plenty of advance warning that things are not going quite--to stay out of trouble. In AMGN's case that trend is more than solidly up--its way up. Selling AMGN for a profit on 17 Mar was a good idea to lock in profits--but its not the same thing as a sell short signal. The idea here is you sell not only to avoid declining prices, but also to avoid flat periods where your money isn't working for you. Its better in my opinion to move on to another play. Its easy to rack up a lot of wasted time on stocks that are not likely to move much for the next week or so. AMGN's consolidation isn't quite over as the bands on price aren't fully narrowed. Its only close to a buy on stochastics because the stochastic is at its own lower band. Can't be sure which way its going to go until we actually see a break up or down--but I'd definitely give it an upward bias. I think AMGN was probably worth a riskier short when the volatility was really high and peaked. High volatility like that often gets a nice price move contrary to the trend. The price didn't drop however in AMGN's case (more evidence that it will break upwards), so I'd cover the short now or wait until you get stopped out. 2) What resources do you think are good for learning TA? The best way I found was looking at lots of charts and stocks on commercially available software and looking for patterns and relationships between indicators, price and volume and writing down what you notice. I've pretty much boiled it all down to those things I've already posted on this thread. Some time ago I posted a checklist of things to look for in charts. 3) How do you manage working and trading? Do you place most of your orders using limits and just wait for the order to execute? (I hope this Q is not too personal, I am a medical student and have the flexability to trade right now.) I work on a computer all day anyways. I always have quote.com open for live charts so I'm always a mouse click away from a real time chart of anything I want to look at. I also check S.I. a few times a day. I also set portfolio alerts on quote.com so when certain prices I set are reached, I get sent an e-mail at which point I'm one click away from seeing the current situation. I also keep my online broker ready for order entry as well. I just stay logged in all day long. I can enter an order in just a few seconds.