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Strategies & Market Trends : Befriend the Trend Trading -- Ignore unavailable to you. Want to Upgrade?

To: Caroline who wrote (1876)	10/14/1998 10:34:00 PM
From: nokomis	Read Replies (1) \| Respond to of 39683

Caroline, Gotcha...apologies but I didn't realize. Am still a student of chart reading (learned a lot from Business Week's article last night on how the experts at Long- Term Capital Management misread the charts to the tune of a $3.6 billion bailout): Here's a portion of it, in case you missed it. "Long-Term's favorite bet was on the difference in the yield, or rate of return, between two debt instruments. Let's say that five year junk bonds rated BB3 usually yield about two percentage points more than five-year Treasuries because of their higher risk. Long-Term's strategists might bet that if the yield spread ever got much wider than two percentage points, it was likely to narrow again soon... "Computer models would show that's a smart bet. But with the global economy in turmoil, investors lost their appetite for risk. Starting in July, they fled junk bonds and poured money into Treasuries.. That pushed yields higher on junk bonds and lower on Treasuries. By late September, the yield spread had widened to a punishing 2.8 percentage points (can't replicate chart here). Instead of converging, the yields diverged." My point? I'm a sponge for info and learning -- yet my gut says use it all, not just the charts.. You've taught me a lot with your post -- however, being a novice in trading (and not-so-novice in business), perhaps I should remove myself from this thread...but before I do, I understand from NCT's business cycle and their history of earnings (see below) why not much was happening in their quiet period after July...when I combine the "news" with the chart, it ALL makes sense. canstock.com All the best, NOK