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

To: Char who wrote (6873)	1/21/1999 9:00:00 AM
From: Jay Lyons	Read Replies (1) \| Respond to of 43080

Morning gang, This is from a long piece on the Street.com today. Scott, maybe you should assign someone to moniter this Trading-Places.com! <G> Investors in huge numbers have been beguiled by the so-called "momentum trading" techniques of hedge fund gunslingers like Jeff Vinik of Vinik Asset Management. In momentum investing, you buy a stock not because it is any good as a business, but simply because others are buying it and the price has thus begun to rise. Doing so successfully has been generating staggering payoffs. Consider what happened on Jan. 13 when, at about noon, an Internet chat room -- Trading-Places.com -- posted a tip that Golden Books Family Entertainment (GBFE:Nasdaq), the near-bankrupt New York publishing house that was then selling for 34 cents a share, would soon be the target of a takeover bid by Walt Disney (DIS:NYSE). Investors in the chat room began to load up on the shares, and trading volume quickened to 41,000 shares in the next hour, or double the pace of the previous hour. Then, at 1 p.m., Bloomberg Business News carried a story quoting Disney chairman Michael Eisner as expressing interest in acquiring Golden Books, and within seconds the company's stock was overwhelmed with an avalanche of Internet buying orders -- nearly 1.4 million shares in the next 29 minutes alone. Finally, at 1:38 p.m., a spread-the-word tip materialized on a Web-site message board of Yahoo, and the fun really began as Golden Books' price rocketed to nearly 75 cents on volume of more than 5.1 million shares. The next day, Jan. 14, was even wilder, as seemingly every Internet trader on earth piled onto the stock, sending trading volume for Golden Books past 27 million shares. Result? This essentially worthless, near-bankrupt company instantly became one of the year's biggest gainers (530% in just 48 hours).

To: Char who wrote (6873)	1/21/1999 9:11:00 AM
From: LastShadow	Respond to of 43080

End of Day Gap Plays For those who hold for more than a few hours, there is a way to play up and down Full Gaps on an end of day basis. If a stock gaps up and both the low and close is above the previous day's high, one would buy at open the following day with a limit equal to the previous days's high. Looking at GNET'c chart for example, you been filled on Jan 6th and been immensely profitable. For AMZN it would have filled and been profitable for both Sep 9th and Dec 22 - actually a lot of stocks would have gotten filled Dec 22 - CMGI, YHOO, etc. jan 6-7 was great for ones like lcos, xcit, etc. The trick is to determine if there is a sector wide jump, with lots of strength in the general markets as well. Well, there is a second trick, and that is knowing when to get out, but the basic rule of thumb of 25% gain is kind of pointless lately... lastshadow