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Strategies & Market Trends : The 56 Point TA; Charts With an Attitude -- Ignore unavailable to you. Want to Upgrade?

To: U Up U Down who wrote (26693)	2/24/1999 3:33:00 AM
From: Doug R	Read Replies (2) \| Respond to of 79230

George, Oh no...I was driving home from work tonight and began toying with a conceptual post that entailed a significant bent toward getting on a TA soapbox. There may be an amount of disjointed prose from here but........ OK, the legal situation with SPYG really ticks me off. So what...a bunch of 37 year olds pretend to themselves that they REALLY have a fundamental handle on this friggin' company when it breaks from a price of $12 to $15. These self proclaimed "fundamentally astute" folks with risk capital to spare, jump on board. Now what the heck are they jumping on? I must say they're jumping on HOPE. From where does this hope emanate??? It emanates from press releases and internal company exuberance. It emanates from the opinion of the "smart" money. At every seminar I've held, I've expounded on the notion that the "smart" money is not always as smart as it thinks it is. In the stock market, hope based on what can easily be faulty perception of REAL potential amounts to delusion. Since reality is entirely subjective, "story stocks" are what most "fundamentalists" lose money on. Pray in church...not on Wall Street. NOW...to move on to where my own work has originated; it appears to me...(I wear a different set of lenses than most) that what a company does and what its stock does are most often, two different things. What I focus on is what stocks do. Most stocks are doing things that make them a gamble. There are however, stocks that actually conform to a paradigm set or several paradigm sets that allow for a high degree of predictability as far as price direction is concerned. Getting back to SPYG, there was a "story" that even the smart money bought into. The MIMBO that was activated from this story is evident in the chart. So what??? Well, a bunch of "investors" followed the smart money. That is evident in the high volume move off the MIMBO retest. The problem with these "believers" is that they had no experience with what stocks do. They were too ensconced in "the story". Well, one thing that stocks do when the story outstrips reality is....they break the IL. That's exactly what SPYG did. Now, were the "investors" in SPYG "duped"???? Of course they had no idea that SPYG had violated the IL. But it can also be argued that since they were involved in the stock on the basis of "the story" and were basically ignorant of what stocks do, they actually have NO basis upon which to bring a shareholder lawsuit against the company. It's the classic example of..."a little knowledge is a dangerous thing". Proper knowledge of what stocks do would have made anyone with that knowledge a very tidy sum with SPYG on both the long and short side. SPYG gave every signal necessary to do so. Ignorance is no excuse. Doug R PS, So George, are you falling into the story on BJCT or can you actually see what the stock is doing? What a company is doing and what its stock is doing are most often two entirely different things.