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Biotech / Medical : SANGUINE CORP. (SGNC) -- Ignore unavailable to you. Want to Upgrade?

To: Profiteer who wrote (1703)	6/24/1998 7:27:00 PM
From: Gwolf	Read Replies (1) \| Respond to of 5402

Profiteer, remember how I told you just before the stock took off from $.50 to $1.15 that I felt we were getting ready for a move ? I mentioned that the stock seemed to have slow and steady accumulation that was drying up the float and that if any buying came in it would send the stock up. I'm looking at the volume and the action of the MM's on this move down and I think we are getting poised for another move up. On the last run they were willing to give you all the stock you wanted in addition to some legitimate selling. Right now they are withholding stock, They must still be short and very uncomfortable about the stock going lower.If they were confident it was going lower they would be shorting the stock to us. Since the double peak on 6/18 you have seen the volume steadily decline. 6/18 - 848,100 6/19 - 279,700 6/22 - 106,000 6/23 - 150,000 6/24 - 119,400 This doesn't give them the volume they need to cover their shorts and the public isn't selling in any type of volume. That means the accumulation so far is still in strong hands. For those of you that are technically inclined this looks like a classical test of the break out area. If you are not familiar with this I'll explain. The stock breaks out of a basing pattern where there has been steady accumulation for a protracted period of time. After the initial thrust there are people that have gotten tired of holding and they sell into the rally. At some point the buying slows because the stock has run a little to far to fast. The ensuing decline or retest takes place on low volume not high volume. This is important because if it was a high volume sell off that would tell you that the investors that had accumulated for the last year or two didn't think there was any potential for the stock to go any higher than the current high and were now taking all of their profits. This has been a low volume sell off. What happens next is that those individuals that missed the run up hope that the stock will come back down into their buying range. They don't wait for it to come all the way back down because they don't want to miss it the next time it starts to move. They start buying at roughly the 66 2/3% retracement level. In SGNC's case the stock broke from the .56 level and ran to 1.15. A 66 2/3% retracement is .39. $1.15 minus .39 is .76 level. Once the individuals that missed it see it decline to this level they begin to nibble at the stock causing a low to set in. That can cause either a V-shaped low or a U-shaped low depending on how aggressive the buying becomes. The U-shaped low can take anywhere from 3 to 10 days. the V-shaped low literally turns on a dime. The U-shaped low usually starts with some cautious buying and the accumulation continues until the buyers feel safe that the decline has stopped. As the buyers feel more secure the level of buying picks up and the stock is now in the position to test the high. If the the pressure is great enough the stock goes right through the old high and ... well that's another chapter. I think the next few days to a week are going to give us some important clues as to what is going to happen next. Everyone keep your eyes open and don't snooze. Gwolf