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Microcap & Penny Stocks : FRANKLIN TELECOM (FTEL) -- Ignore unavailable to you. Want to Upgrade?

To: mark glicksman who wrote (36301)	7/17/1998 2:06:00 AM
From: topwright	Read Replies (1) \| Respond to of 41046

Mark, good question. Unfortunately, the art of buying a bottom is very elusive. Some claim they can do it, and I am sure they can, but rarely with any accuracy. Like picking horses, tomorrows paper today, is about the only way I know of. If you find that paper let me know, I will be happy to subscribe. Seriously, what I try to do, is time buy/sell to be 10% from the top or bottom, that I can usually do with some accuracy. As I use the printing of the tape, price action, pace, and size, all to tell me, like a confirmation. But even then it can reverse on you, and retest the bottom or top again. But if you also add a good dose of common sense in valuation assessment, the odds are that you will still be rewarded more times than not. For example, if a stock rises to unreasonable heights, the first question I ask myself "Would I buy it here?" if the answer is hell no, then it is time to sell. When a stock is falling, I ask "Would I sell it here?" if the answer is hell no it is worth more than this, then it is time to buy. Sometimes it is as simple as that, but when that down home common sense method is applied to the tape prints, ie pace, direction, volume, it seems to give a good guide. I also look at charts paying attention to what was major resistance points on the way up, as they will become major support areas on the way down, etc. Bases look like shelves on a chart for those that are inexperienced. The reason why I place less emphasis on Technical Analysis and chart reading regarding a Bulletin Board stock is twofold; one is the fact that volume is usually erradict which takes away the smoothing effect, and two BB's run on stories, so the chart is more reflecting of news induced price action, than price action based on fundamentals such as earnings reports. Bottom line, when buying or selling a unproven stock , perceived value is the only guideline. That perceived value is based on potential of market, the ability to penetrate that market, evaluating their edge if any, capitalization, and one that I weigh heavily is assessing the management's experience. There certainly are many other factors that make up the composite, but those certainly are key ones. Above all else, let reason not emotion guide you in your transactions, never buy or sell based on what the herd is doing. Hope this helps, rb