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Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank -- Ignore unavailable to you. Want to Upgrade?

To: Burjis S. who wrote (28715)	3/20/1999 5:10:00 AM
From: Jenna	Read Replies (1) \| Respond to of 120523

We need a TV program loosely based on ER "The Traders".. Frustrations, Excitement, Huge Gains in the trading pit. starring Burj (George Money), and Adelle and Susan can audition for the Susan Lewis / Carol Hathaway role.. I reserve Eric LaSales role (he's always been my favorite on the show Dr. Benton (makeup might be a little tricky here) Kha Vue as Anthony Edwards and Small Fry Noah Wylie.. The love interest is going to be a hurdle to overcome here, but everything else seems to be easily workable. Kha, being so resourceful and organized, will get in touch with Michael Crichton to do the pilot for our series.

To: Burjis S. who wrote (28715)	3/20/1999 9:05:00 AM
From: Jenna	Read Replies (3) \| Respond to of 120523

Technical Observations.Market Gems short and longer term "breakouts".. <Long Post> We have often used expressions in our watch lists and newsletters repetitively.. Expressions such as "4 week high" or MACD is bullish, RSI breakout, CUP and Handle Breakout, Double Top Point & Figure Breakout, Linear Regression Slope, On Balance Breakouts. We basically use a breakout trading systems for our plays. The Watch List is based on a 7 day - 2 week channel breakout system whereas the earnings plays will be based on a longer term 50 day channel breakout together with a 1-3 day channel breakout (before earnings = our anticipatory upswing) You can substitute other breakouts for the word "CHANNEL". We also discuss long term pattern breakouts like Head & Shoulders breakout. Here again we have the short term breakout (5 days or so) and the longer term breakout (50 days to 10 weeks). If we talk of a MACD breakout we would mention if it was a weekly MACD breakout 12/8/7 week or a daily MACD breakout 12/8/7 days same is true with RSI, Momentum, Momentum and MACD histogram etc. Optimally we would like BOTH a longer term and short term breakout. For example when something goes on the watch list it usually has had a longer term breakout and the stock will be on the watch list as it is approaching its SHORT TERM BREAKOUT.. (early breakout). Having a stock reach a 4 week high is already a channel breakout of sorts and in essence you already have a stock that is a buy.. Entry to be determined by 1/4 to 1/2 point above the closing bar etc. I like to mechanically define my entry points well in advance of actual entry so I don't get nervous about pulling the trigger. Sometimes I time entry as the highest high of the last 7 days, or 13 days or 4 week as we stated. Most of our watch list candidates have come as a result of breakout based on chart patterns (Head & Shoulders, Double Top Point & Figure Breakouts or on clear penetration of support or resistance lines when applicable, breakouts of upper Bollinger Bands (volatility breakouts),Weekly/Monthly Stochastics Breakouts. For intermediate plays we like breakouts out of 5-6 weeks of consolidations or basing. We always use at least 4 volume indicators for confirmation. We encourage you to have goals at the onset.. That way you can know if a minor correction in you stock will cause you to leave the trade or forego it. You should know that the signals to exit a trade are different for an intermediate term trader. You also have to determine if the uptrend you are now riding is a beginning uptrend or one that has been established for a longer period. That is why some of you that enter the internet stocks do so after a long established uptrend and the possible continuation of this uptrend is now suspect. We now have a question: When have we had enough of a falling stock. You don't want to sell your stock after it just begins to move down because unfortunately just about then the reason you bought the stock in the first place begins to assert itself (i.e. your stock has beaten the street in its earnings report) and the stock rises. But you have already sold. So I like to give more leeway to stocks that have all the 'reasons' to be up. Also some stocks have trouble at some resistance levels and retrace downwards to a previous level, but eventually after enough re-testing they might actually break through (NKE and BMET this week were examples).. BMET did not react really quickly after their earnings report and was having trouble at its 52 week high.. once it successfully broke through resistance BMET was good for 4-5 more points. So you should determine even before you make the trade where you will put the stop and how much loss are you willing to take. Knowing when to take profits is no picnic either. Sometimes stocks that you expect to make large moves only make small moves for a number of days (BKS) or even make a small move down.. Again if you an intemrediate trader you have to expect that the stock will have trouble and certain support and/or resistance levels and might make tiny moves before finally breaking out. DCLK was having trouble and was down 5 points in two days and the decision had to be made whether to get stopped out or hold.. A decision to be stopped out eventually could have lost you as much as 50 points!!! You just have to take each stock on a case by case basis. How long has this stock languished at support? weeks, days? Remember FIBR did not move for a full day even though the signs were all there for an impending breakout. Well I would wait for signs of volume.. That is your cue that something might be about to change. Without volume as an indicator you might never have a clue. If volume expands I would give the stock more leeway. ....and lastly for those of you who really want to understand exactly the breakouts I use for Market Gems they are in 3 books.. 1)Curtis Arnold's Pattern Probability System) 2)Technical Analysis of Stock Trends by Edwards & Magee 3)Day Trading with Short Term Price Patterns and Opening Range Breakouts (its good even if you are not a daytrader) These books don't have to be read but the breakouts and analysis comes from there.. Better books would be the general ones that were already mentioned on the thread.. and anything written by John J. Murphy (i have the visual investor) and Martin Pring.. These books mentioned are text books and classic. I don't hold with some of the newer and 'faddy' books on indicators (except the RSI which I am checking out) Another article will show you the chart patterns we use for breakouts and what to look or.