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Strategies & Market Trends : LastShadow's Position Trading -- Ignore unavailable to you. Want to Upgrade?

To: judge who wrote (6323)	1/13/1999 6:53:00 PM
From: LastShadow	Respond to of 43080

Intraday Charting... Every once in awhile I give my take on this one when someone asks. The best way I have found to do it is by what I will call 'selective trendlining'. Basically you trendline the stock only you line through any single point drops (on the way up connecting the lows) or spikes (on the way down connecting the highs). This eliminates those times when the mm is taking some poor soul's shares, or stifing someone with a market order. It generaly works for stocks trading over 500k a day. less than that and then you have to take the volume effect into account, as to wheter the trading action was triggered by block buys or sells, etc. Once you have done all of this, you will get a feel for whether the stock was being accumulated on dips, or just being sold off whenever a local intraday high was hit. having that information, you can now look at the last half hour of trading to see if one of two things was happening: 1. Did the finishing trend close even or up on increasing number of trades and appreciable volume (several 5-10k share blocks hopefully). 2. if it closed down, was that manipulative to pick up a larger block or in the finishing few minutes of people just exiting at close at market - for which the mm took some advantage. If the answer is yes to either of those, then generally we are looking for an up open on the stock. lastshadow

To: judge who wrote (6323)	1/13/1999 8:52:00 PM
From: j g cordes	Respond to of 43080

judge.. can one day's trading provide the next day's range? I'd prefer to rephrase your question so it makes statistical sense. The key to understanding probability in trading is the sample size versus the projected time period. One day can be very useful for an hour or two, a week can be useful for a day, a month for five days etc. There are occasions when, like today, a very stressing general event occurs. How a stock responds to great stress is revealing even in a one day time period.