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To: nord who wrote (7254)	11/4/1998 10:22:00 PM
From: Doug	Read Replies (1) \| Respond to of 18016

Nord: You need a bit of TM (Transcendental Meditation) to do good TA.! TA is extremely useful for detecting patterns and detecting valid correlations.It is based on a simple fact that Human behavior in terms of cycles of greed and despair have remained constant over time and can be analyzed. T.A can detect the start and end of such cycles both on a micro and macro level. By using past historical data one can also establish levels of support and resistance. I select Companies based on absolute fundamentals with no concern about their current price. Then based on the their past Fundamental ratios, I establish a low and high valuation. Thereafter I use TA to detect an entry point which carries the least downside risk. I use TA on a similar basis to exit the stock taking into consideration the market conditions and historic valuations. Despite this, mistakes occur. These are generally due to Fraudulent Accounting including Inventory etc. Such errors can be devastating and usually occur in Tier 2 and 3 Stocks. In the case of TIER 2/3 Technical stocks,their product cycle usually last 15-18 mths at most. It is therefore necessary to also correlate the product cycle to that of the chart period under study. Good luck.!