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Strategies & Market Trends : LastShadow's Position Trading -- Ignore unavailable to you. Want to Upgrade?

To: Susan Saline who wrote (13247)	4/24/1999 11:54:00 AM
From: LastShadow	Read Replies (2) \| Respond to of 43080

For what its worth, I agree with this analysis: "It seems to me that the odds favor a drop in prices next week, followed by a failed attempt to resume this week's rally. This view is largely based upon my reading of the McClellan Oscillator's pattern. This indicator uses the difference between advancing and declining issues on the NYSE. My guess is also based upon the failure of new highs to continue relative strength again today. After a week like this, we're tempted to conclude that anyone's guess is as good as another's. The picture is very murky. And you can be sure you're not the only one looking around for clarification of the impossible." For my own thoughts: The caveat I see is that even the daytraders, and I'm talking about the experienced ones, are not being as cautious as I have seen them in the past, say two or three years ago. Even though the 'buy-on-dip' process is working now, and fortunately, those using stop loss and judicious risk management practices are going to be okay. Sue is proably right that it will go on for a bit longer than most of the wags project, for a lot of reasons. But when you look at the best of the internet stocks fundamentally, and discover that even the biggest AOL, only comes in about 535 on the Fortune 1000, you have to question the motivation. As long as one can buy and sell the stock and make money, it may be immaterial that the intrinsic value of the company is poor. But at some point, whether that is some atmospheric pricing, or an increase in the float, or a year or two after the inexperienced ones figure out that they don't "always come back" to where they bought it, they will start selling. The group I am with bought AOL at 91. I sold it at 159 and rebought at 117 last week. It closed at 148, but that wasn't high enough to break the trendline connecting the highs since the last reversal. Monday we will look to see if starts dropping to the point we will take profit again, or hold if it stays stable or goes up. If you are doing that with a couple of large blocks your sensitivity has to include something more than the faith of a few million daytraders. It has to include a rigorous risk management plan and a bit more general market analysis. And if you are only doing it with 100 shares, you should be just as cautious. I pay attention to the number of trades and volume of the specific stocks, but now my concerns are more to the overall strength or weakness of the market beyond the capitalization-weighted indices. Valuations are rotting away beneath the surface here. Money is changing hands, and thats great while it happens. But unless someone ever comes up for a good reason why the P/E of YHOO is 1,500 the concern by financial institutions and others who see the potential risk is going to persist. And for good reason. Develop a trading method that works and use a rigorous stop loss program. Preserve your capital. There will always be another stock to make money on tomorrow. Don't get greedy or overconfident that it will always recover. Take a step back and look at the overall market at least once or twice a week, and I mean all sector indices, not just the SPX, OEX or nearly worthless DOW. Make money when and how you can for now, but don't ignore the gang crying 'wolf'. Because even accidentally they might be right one day. lastshadow

To: Susan Saline who wrote (13247)	4/24/1999 1:17:00 PM
From: AlienTech	Respond to of 43080

Net IPOs lead next week's pack Next week's Internet IPOs include Mpath Interactive, Marimba, Razorfish, AppliedTheory, and Musicmaker.com. Mpath Interactive, which sells software used for activities such as real-time games, plans to sell 3.9 million shares at $10 to $12 each, raising about $42.9 million. Mpath operates a Web site and sells software, which means that it has two revenue streams, said Steven Tuen, research director at IPO Value Monitor. While the company's market is mainly limited to game players, that concentration is attractive to advertisers, especially as game players tend to stay online for a long time. Marimba, which sells software that lets companies distribute and update software over the Internet, plans to sell 4 million shares at $13 to $15 each, raising about $64 million. Both Mpath and Marimba are based in Mountain View, California. Marimba's products appeal to organizations with a lot of mobile users or geographically dispersed offices, the company's president, Kim Polese, is a well-known Silicon Valley executive. New York-based Razorfish, which provides Web site design and other services, plans to sell 3 million shares at $10 to $12 each, raising about $33 million. Great Neck, New York-based AppliedTheory, which aims to provide businesses with one-stop shopping for Web site development, design, and hosting, as well as Internet access, plans to sell 4.5 million shares at $12 to $15 each, raising about $60.8 million. "As companies continue to develop a presence online, they're going to require third-party consultants to help them, in part because of a lack of expertise. Proxicom, which builds Web sites for online businesses, rose 50 percent in its first day of trading earlier this week and closed at 19, up 46 percent from the sale price. Reston, Virginia-based Musicmaker.com, which sells music over the Internet, plans to sell 3 million shares at $7 to $9 each, raising about $24 million. Palo Alto, California-based Informatica and San Francisco-based Butterfield & Butterfield Auctioneers also plan sales. Informatica, which sells software to bring together information stored in a variety of company databases, plans to sell 2.3 million shares at $12 to $14 each, raising about $29.4 million. Butterfield & Butterfield Auctioneers, which recently announced an agreement with online auctioneer eBay, plans to sell 1.5 million shares at $10 to $12 each, raising about $16.5 million. Butterfield's IPO was originally scheduled for this week. Heidrick & Struggles "is a leader in its field," and the company is "doing very well fundamentally," said Efron, who met recently with management. Heidrick & Struggles "will be coming out at a discount to Korn/Ferry," which went public in February at 14 and closed Friday at 12.25. "Management and investment bankers are aware of the market for human resources, so are going to price the stock realistically. news.com