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Strategies & Market Trends : Point and Figure Charting -- Ignore unavailable to you. Want to Upgrade?

To: stan s. who wrote (8077)	9/30/1998 2:57:00 PM
From: MileHigh	Respond to of 34809

stan, I look forward to the expert responses on RMBS. The candlestick chart is very telling to me because one can fundamentally understand perhaps that massive short covering was the only reason RMBS spiked above 67.5 to 71.875. Once the short covering subsided, there were no new "fresh buyers" to move it any higher or to sustain a price even near 68-70. The price moved lower off the high and the shorts probably moved in again seeing the weakness and pushed it down to 63 for the day. My opinions are not based upon any TA expertise or understanding of P&F, but it is based upon my personal understandings of RMBS and how it has spiked many times before without sustained follow through and "fresh buyers" to push it higher (besides short covering). MileHigh

To: stan s. who wrote (8077)	9/30/1998 3:09:00 PM
From: Ms. X	Read Replies (3) \| Respond to of 34809

Stan, Excellent question so you will have to take away your self imposed "idiot" label. Let me ask you this (to get you to think about this) why wouldn't you want a representation of what people were willing to buy or to sell the stock to? Does the close price alone give you that information? Just registering the close prices doesn't give you the whole picture. The only way to truly measure supply and demand is to track the full breath of the stock movement. This is why we take the highs and lows of the day. Where was the stock bought to and are "they" willing to buy it past a previous high. Where was the stock sold to and are "they" willing to sell for less than a previous bottom. For whatever reason and it doesn't matter what reason really (TA wise), RMBS was bought past previous resistance. Demand was in control. The close price doesn't represent this. For you to understand this you must follow more than one stock. Check lots of charts and how breakdowns and breakouts work. Can you imagine if you only noted close prices ignoring a major breakdown mid-day in a stock? Next day it drops 20 points and you would be left wondering why. The answer would be it was sold during mid day past previous support indicating something really was wrong with the stock. Yadda yadda. I could go on with examples. I hope this at least cleared some of it up... I hope... Ready for next question. Jan I am