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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?

To: jlib who wrote (20809)	3/15/1999 9:03:00 PM
From: eims2000	Respond to of 122087

I began shorting EFAX on thursday, last week and was in with 3000 shares at 12 5/8. Friday at noon EFAX was trading around 11 1/2 and I had planned to close it around 3:00 that day (prior to the weekend) because, though it was profitable it wasn't doing that much. For some reason (I think that someone knew about the XOOM news ahead of today) the price started climbing up and before I knew it it was at 12 1/2. I decided that I will let it go (it went to 12 15/16 by the end of Friday) and then average up on Monday. This morning I started to average up and was at 5000 shares at 16 and there was a brief downturn where it went to 14 1/2 or so. But then it took off and at this point I could of kept averaging up but I decided to cover at 17 and wait till it died down. I began shorting it later at 21 5/8 and was able to recover $5000 but I covered so as not have a repeat of this morning tomorrow. If I had an account that would allow me to have an equal Long position then that would have helped, by holding a long position I would have stopped my losses at 17 and then sold off the long at 21+. Problem is now that my broker does not have any more shares available so I wont get to play tomorrow (not that I particularly want to). Normally I would close a position like this on Friday when it acted kinda wierd but my position was only 3000 shares and I figured that at most it would rise 1 or 2 points (not 8 or 10). I will probably be a little more conservative on playing these overnight and over weekends. EFAX had never actually completely turned south (like others that drop like a rock) so I should have been a little more cautious with it on Friday. The most important thing on a short play is not to get squeezed and there are ways to keep that from happening. In this case I should have covered at 14 and started shorting near the true top of 22. I am not simply saying this in hindsight, but with respect to the enourmous volume that was trading when I was averaging UP. This thing was trading very fast which also delayed my exit, I kept waiting for a level place to cover my shares. Hope this helps. Bob