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To: brichard who wrote (6814)	3/23/1999 9:13:00 AM
From: TraderAlan	Read Replies (1) \| Respond to of 12617

brich, Everyone's buying and selling behavior is different. When a stock makes the big run and swings sharply back down (take JBOH or SIEB for example), there are a bunch of folks who bought near the top and remain in losing positions. This creates a large overhead supply or "hang". As the stock rises again, some % of these losers exits, dropping the stock back down again. In your example, you're showing a slightly higher high each swing. This is NOT common. Nominal new high patterns are not bullish, except for slower blue chips that move in lower percentages. The nominal highs don't allow buying pressure to build sufficiently to generate good momentum (sort of like the extra amount of fuel the space shuttle needs just at the liftoff point). Rather, the top represents a long term one for many stocks but if a "shock" event comes along (big news, acquisition, etc), the supply can be overtaken by heavy demand, leading to a new up move. As that move is in progress, the new supply of losers hasn't formed yet. That's one reason why stocks at all time highs can go vertical, i.e. no overhead supply. Alan