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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: sean sanders who wrote (5045)	1/30/1999 8:24:00 PM
From: Elroy Jetson	Read Replies (1) \| Respond to of 99985

You asked how you could have avoided the tumble in EFII on 7-16-98. geocities.com Two ways. First, you held the stock during the time they announced their earnings after the close on 7-15-98. Obviously someone expected better results. You can see this more recently in Nokia (NOK/A) and others which announce good earnings, but obviously not up to investor's fantasies. Every time you hold a stock for the earnings announcement you're taking a risk that has little to do with T.A. Second, you were trading a stock with little volume. All it took was for one institutional investor to be disappointed and the stock tanked. Stocks with greater volume can help mitigate the impact of one large shareholder.

To: sean sanders who wrote (5045)	1/30/1999 8:34:00 PM
From: HairBall	Respond to of 99985

sean sanders: Well, I will give you my take, which comes from my own experience not a book...<g> I printed out the chart, however I really need to see more of the chart prior to 98. There are several things wrong with the formation drawn. 1 - The trend lines are not drawn correctly. Should be drawn at the highs and at the lows. 2 - #1 does not matter because. The formation starts from a rally at the end of April 98 into a top mid May. This top in May is used for the fist point of the upper descending trend line. Next a decline into the end of May goes below the rally start point in April. This invalidates this formation for me. Regards, LG

To: sean sanders who wrote (5045)	1/30/1999 9:13:00 PM
From: HairBall	Read Replies (2) \| Respond to of 99985

sean sanders: I pulled up the daily chart for EFII so I could see more of the chart. Start a formation at the low at the end of May (5/27). One can make the case for a bearish pennant or a rising wedge (bearish). The move up on (7/15) would have been considered penetration of the upper trend line, but only a violation needing next day follow through to validate. Of course this follow through never happened...<g> I always look for confirmation...the Big Boys know charting too! In addition, I never use charting as a sole indicator. Chart formations are not 100%. BWDIK Regards, LG