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Strategies & Market Trends : Z Best Place to Talk Stocks -- Ignore unavailable to you. Want to Upgrade?

To: Larry S. who wrote (16216)	9/9/1998 7:21:00 AM
From: Ron McKinnon	Read Replies (1) \| Respond to of 53068

"Market turn or head fake" well the early line is saying a down open trading a market like this is very difficult yesterday the opening gap was so big that it would have been hard to enter at a reasonable price if the open gap down today is large, than getting put will be equally hard so my read is this: not a time to take on any large long term holds; just dabble here and there on a few favorites in small pieces at best intraday flips can give some good gains with these big swings; just focus on say 3-5 very strong stocks that one knows well; take some small gains as they come to pay the rent position/swing trades of 2-5 days in duration may be the overall best bet as the market ebbs and flows the trading range and support/resistance of the market and each stock is becoming clearer and possibly more solid lets take BKB as an example on a post split basis this one ran from 1 1/2 in its darkest days of 1991 to a high of 59 on 7/7/98; a 40 bagger during 1996-97-98 it ran up on good earnings and takeover speculation it then fell a huge 40% on various financial concerns about the US economy and international exposure as well as failing takeover speculation a 2 year chart shows support in the 30-32 and 34-36 areas which appear to be rock solid resisatance is at 40, 44, and 50 so let's say I wanted a 1000 share position a way to play that might be to buy 200 at 36 1/4 300 at 35 1/4 500 at 34 1/4 set sell stop at 33 3/4's sell off near resistance at 38 1/2-40 have a buy stop ready at 40 1/4 or so to catch a break out then do the same in the 40-44 range ditto for a buy stop at 50 1/4 the more often a stock stays in a tight range the stronger the support and resistance becomes and the more important a breakout will be there are ways to make money in this kind of a market but one needs focus, patience, selectivity, and buying power