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canslim-digest        Saturday, August 1 1998        Volume 02 : Number 346



In this issue:

       Re: [CANSLIM] follow through day calculation
       [CANSLIM] Shorts
       RE: [CANSLIM] follow through day calculation
       Re: [CANSLIM] follow through day calculation
       RE: [CANSLIM] follow through day calculation
       RE: [CANSLIM] follow through day calculation
       RE: [CANSLIM] follow through day calculation
       Re: [CANSLIM] thousands of stocks rise each day
       [CANSLIM] follow through count
       Re: [CANSLIM] follow through count
       [CANSLIM] earnings release dates and sec filings, and insider buying .
       Re: [CANSLIM] follow through day calculation
       [CANSLIM] follow through day confirmation - Mike Lucero
       RE: [CANSLIM] earnings release dates and sec filings, and insider buying .
       [CANSLIM] "M"
       RE: [CANSLIM] "M"

----------------------------------------------------------------------

Date: Fri, 31 Jul 1998 09:11:30 -0700
From: Tim Fisher <[e-mail]>
Subject: Re: [CANSLIM] follow through day calculation

Heck with that, although I am following the discussion with much interest
(IMHO
you all are dissecting M way too finely). Y'know what I noticed yesterday?
Lots
of stocks that I had got stopped out of that popped up 7-10% off a short term
downtrend. Know what scares me? The volume was missing on ALL of them. First I
kicked myself for not watching and buying back, then I congratulated myself
for
refraining from doing anything. Yesterday made me scared more than anything.
The broader market is not participating anyway. So I was not surprised at
today's reaction to the (relatively) good GDP number. Dunno why anyone else
would be (except those morons at Infobeat!). Seriously now, is anyone here
ignoring M and still in up to the hilt? I'm in cash except for index funds and
a worthless stock.

At 07:15 AM 7/31/98 -0700, you wrote:
><<I'm confused about how to count to the follow through day. When
>counting
>from the low day, is day 1 the low day? For Dow and NYSE, with the
>lows on
>Tuesday, that would that make today day 3. Are we waiting for day 3 or
>day
>4? I thought the book was confusing on this point, saying something
>like to
>usually wait for day 3, but wait for day 4 after a major low market
>low. (I
>don't have my book with me.)>>
>
>There was quite a bit of discussion on this during the last rally,
>along with a discussion of W formations.  You may want to look that
>stuff up in the archives.
>
>Whether the bottom day counts also as the first rally day depends at
>least in part in what happens during the day.  If it closes at or near
>the low, it would be more difficult to call it a "rally day" than if
>it closed at or near the high.
>
>But I don't think that what O'N has in mind is for thousands of CSers
>to begin counting on their fingers from some set point.  This is why
>he's so vague about the number of days--four, five, six, whatever.
>The point he's trying to get across, I believe, is that the first day
>or so of rally can't always be trusted.  There's the dead-cat bounce
>phenomenon to be considered, along with the possibility or probability
>of short-covering, and the only way to know whether the rally attempt
>was the result of these phenomena or a genuine buying interest is to
>see what happens after the first couple of days.  Does it fizzle?  Or
>is there renewed or continued strength?
>
>This is also why a rally attempt much later than the first has less
>importance--the longer it waits, the less connected it is to the first
>rally attempt or bounce.
>
>Therefore, look not only for an increase in the indices, but also an
>increase in volume as he advises.  Factor in breadth.  Note how many
>indices participate.  Note the behavior of the leaders.  All of this
>can give you a sense of how legitimate the rally is and how likely it
>is that it will be sustained.  In any case, it would not be prudent to
>make big-time investments in new positions on the fourth day after the
>bottom simply because it happens to be a strong day.
>
>--Db
>

Tim Fisher, 1995 President, Pacific Fishery Biologists
Ore-ROCK-On Rockhounding Web Site
PFB Information
mailto:[e-mail]
WWW http://OreRockOn.com

- -

------------------------------

Date: Fri, 31 Jul 1998 11:46:17 -0500
From: Carl Holden <[e-mail]>
Subject: [CANSLIM] Shorts

I am getting more interested in shorting and puts EVERY single day.
Please count me in if it comes about

Thanx!
cmholden


- -

------------------------------

Date: Fri, 31 Jul 1998 09:50:11 -0700
From: "Mike Lucero" <[e-mail]>
Subject: RE: [CANSLIM] follow through day calculation

I'm trying not to ignore M, but I'm still half invested, after being 150%
invested on Monday. I thought I'd do better by selling when stocks
invidivually (when each stocks rallied and failed, or broke local
resistance) rather than selling everything all at once.

Mike

> -----Original Message-----
> From: [e-mail]
> [mailto:[e-mail]]On Behalf Of Tim Fisher
> Sent: Friday, July 31, 1998 9:12 AM
> To: [e-mail]
> Subject: Re: [CANSLIM] follow through day calculation
>
>
>  Seriously now, is anyone here
> ignoring M and still in up to the hilt? I'm in cash except for
> index funds and
> a worthless stock.
>



- -

------------------------------

Date: Fri, 31 Jul 1998 14:03:54 -0400
From: Peter Newell <[e-mail]>
Subject: Re: [CANSLIM] follow through day calculation

Last Oct IBD counted the bottom days so I would assume yesterday counts.
What I found interesting was that you could have distribution in the middle
and it count.  To me a rally should be decisive and broad.  IMHO, this
rally was much narrower than all the others and is a stronger indication of
a top either long/short term.  I also beleive based on past events that it
is way to soon for a new rally to start.  Look at last year from Aug-Oct
Same thing correction for a month a great rally and down we go.  Timing is
almost identical here.
- ----------
> From: dbphoenix <[e-mail]>
> To: [e-mail]
> Subject: Re: [CANSLIM] follow through day calculation
> Date: Friday, July 31, 1998 10:15 AM
>
> <<I'm confused about how to count to the follow through day. When
> counting
> from the low day, is day 1 the low day? For Dow and NYSE, with the
> lows on
> Tuesday, that would that make today day 3. Are we waiting for day 3 or
> day
> 4? I thought the book was confusing on this point, saying something
> like to
> usually wait for day 3, but wait for day 4 after a major low market
> low. (I
> don't have my book with me.)>>
>
> There was quite a bit of discussion on this during the last rally,
> along with a discussion of W formations.  You may want to look that
> stuff up in the archives.
>
> Whether the bottom day counts also as the first rally day depends at
> least in part in what happens during the day.  If it closes at or near
> the low, it would be more difficult to call it a "rally day" than if
> it closed at or near the high.
>
> But I don't think that what O'N has in mind is for thousands of CSers
> to begin counting on their fingers from some set point.  This is why
> he's so vague about the number of days--four, five, six, whatever.
> The point he's trying to get across, I believe, is that the first day
> or so of rally can't always be trusted.  There's the dead-cat bounce
> phenomenon to be considered, along with the possibility or probability
> of short-covering, and the only way to know whether the rally attempt
> was the result of these phenomena or a genuine buying interest is to
> see what happens after the first couple of days.  Does it fizzle?  Or
> is there renewed or continued strength?
>
> This is also why a rally attempt much later than the first has less
> importance--the longer it waits, the less connected it is to the first
> rally attempt or bounce.
>
> Therefore, look not only for an increase in the indices, but also an
> increase in volume as he advises.  Factor in breadth.  Note how many
> indices participate.  Note the behavior of the leaders.  All of this
> can give you a sense of how legitimate the rally is and how likely it
> is that it will be sustained.  In any case, it would not be prudent to
> make big-time investments in new positions on the fourth day after the
> bottom simply because it happens to be a strong day.
>
> --Db
>
>
>
>
>
>
>
> _________________________________________________________
> DO YOU YAHOO!?
> Get your free @yahoo.com address at http://mail.yahoo.com
>
>
> -

- -

------------------------------

Date: Fri, 31 Jul 1998 11:29:05 -0700 (PDT)
From: dbphoenix <[e-mail]>
Subject: RE: [CANSLIM] follow through day calculation

<<I'm trying not to ignore M, but I'm still half invested, after being
150%
invested on Monday. I thought I'd do better by selling when stocks
invidivually (when each stocks rallied and failed, or broke local
resistance) rather than selling everything all at once.

Mike>>

I agree.  There's no reason to sell everything you have just because
the market declines by a few percentage points.  As long as your
stocks are holding or even rising, why sell them?  Thousands of stocks
rise every day.  Taking new positions, on the other hand, is another
matter entirely.  For that you want at least some assurance that the
wind is at your back, not in your face.

- --Db





_________________________________________________________
DO YOU YAHOO!?
Get your free @yahoo.com address at http://mail.yahoo.com


- -

------------------------------

Date: Fri, 31 Jul 1998 12:03:40 -0700
From: Tim Fisher <[e-mail]>
Subject: RE: [CANSLIM] follow through day calculation

Hmmm, I assumed you were using WON stops. Guess not. I was, and I'm decidedly
O*U*T.

At 11:29 AM 7/31/98 -0700, you wrote:
><<I'm trying not to ignore M, but I'm still half invested, after being
>150%
>invested on Monday. I thought I'd do better by selling when stocks
>invidivually (when each stocks rallied and failed, or broke local
>resistance) rather than selling everything all at once.
>
>Mike>>
>

Tim Fisher, 1995 President, Pacific Fishery Biologists
Ore-ROCK-On Rockhounding Web Site
PFB Information
mailto:[e-mail]
WWW http://OreRockOn.com

- -

------------------------------

Date: Fri, 31 Jul 1998 12:55:16 -0700
From: "Mike Lucero" <[e-mail]>
Subject: RE: [CANSLIM] follow through day calculation

I would have been much better off to sell last week, but I missed the
signals, and now I'm trying to make the most of my positions. I think I sold
8/10 today so far.

I got out in time in April, and it feels much better to do that.

Mike
> -----Original Message-----
> From: [e-mail]
> [mailto:[e-mail]]On Behalf Of Tim Fisher
> Sent: Friday, July 31, 1998 12:04 PM
> To: [e-mail]
> Subject: RE: [CANSLIM] follow through day calculation
>
>
> Hmmm, I assumed you were using WON stops. Guess not. I was, and
> I'm decidedly
> O*U*T.
>
> At 11:29 AM 7/31/98 -0700, you wrote:
> ><<I'm trying not to ignore M, but I'm still half invested, after being
> >150%
> >invested on Monday. I thought I'd do better by selling when stocks
> >invidivually (when each stocks rallied and failed, or broke local
> >resistance) rather than selling everything all at once.
> >
> >Mike>>
> >
>
> Tim Fisher, 1995 President, Pacific Fishery Biologists
> Ore-ROCK-On Rockhounding Web Site
> PFB Information
> mailto:[e-mail]
> WWW http://OreRockOn.com
>
> -
>



- -

------------------------------

Date: Fri, 31 Jul 1998 17:01:37 -0400
From: Peter Newell <[e-mail]>
Subject: Re: [CANSLIM] thousands of stocks rise each day

>Thousands of stocks  rise every day.
> --Db

Most days anyhow ;)

Sorry it's late

Peter Newell

- -

------------------------------

Date: Fri, 31 Jul 1998 17:33:02 -0400
From: Jeffry White <"[e-mail]"@sover.net>
Subject: [CANSLIM] follow through count

Db wrote:

> But I don't think that what O'N has in mind is for thousands of CSers
> to begin counting on their fingers from some set point.  This is why
> he's so vague about the number of days--four, five, six, whatever.
> The point he's trying to get across, I believe, is that the first day
> or so of rally can't always be trusted.  There's the dead-cat bounce
> phenomenon to be considered, along with the possibility or probability
> of short-covering, and the only way to know whether the rally attempt
> was the result of these phenomena or a genuine buying interest is to
> see what happens after the first couple of days.  Does it fizzle?  Or
> is there renewed or continued strength?
>

Mike,

I completely disagree with Db's comments quoted above.  I believe he
misinterprets the follow through count section of HTMMIS (granted, it's
not the best written passage in the book).

I was taught, have personally seen finger counting confirmation,
reviewed back tested computerized data confirmation and had it confirmed
by WON that the count is mechanical from the low.  Regardless of whether
the low is a reversal (although they work best when volume is higher
than the prior day), or a low which has closed dead ass on the low of
the day (like today in the Nasdaq).  The count starts the following day
as "day 1", unless of course it makes a lower low than the prior day.
If, and only if, the index has a follow through day within the 3-10 day
window following the most recent low, it is the confirmation you are
looking for.  How long the uptrend will last, however, is anybody's
guess (see my comments on sentiment herein).

CANSLIM'ers count on their fingers from a set point, absolutely, end of
story.  The most recent low, period.  Don't count from any other spot
off the lows, just the low.

Resist the temptation to "think" about it, just count.  WON doesn't
provide a range of days (the 3-10 day window) in an effort to be
"vague", he does it because that is what his study shows.  Confirmation
of a sustained market turn to the upside comes rather predictably when
the index makes a 1% on volume move, 3-10 days from the most recent low
in the down trend.  Days 4,5,6 and 7 are most reliable.  This is gospel,
and if you don't treat it as such, it will make no sense and you'll
start struggling with a bunch of technical noise and supposition about
trendlines, MACD, EMA's, GDP, ECI, wha-wha-wha-wa-wa....

There can be false signals, however, so don't just haul off and buy a
collection of stocks on the follow through day.  I look at the sentiment
numbers for some confirmation.  If we have a follow through day off
today's lows, for example, the sentiment will probably make it short
lived.  This happened twice after the October 1997 crash before
sentiment finally supported the rally in late January.

Look for sentiment numbers on the order of 52 week marks (as set out in
IBD on Thursday) before marching heavily into the market, even on a
mechanically counted follow through day.  I will often test the waters
with maybe 20% of my account if we get a follow through day with
sentiment which is outside the optimal ranges.  But, I'm quick to look
for a failure.  I'll look back in the chart, but I think we had a
situation like this in April of this year where sentiment was high and
we had a follow through off a low.  See if you can find it, and remind
me if I don't post it within a day or two.

Keep counting those fingers, Michael.

Jeffry



- -

------------------------------

Date: Fri, 31 Jul 1998 16:34:57 -0700 (PDT)
From: dbphoenix <[e-mail]>
Subject: Re: [CANSLIM] follow through count

<<I was taught, have personally seen finger counting confirmation,
reviewed back tested computerized data confirmation and had it confirmed
by WON that the count is mechanical from the low. . . . How long the
uptrend will last, however, is anybody's guess.>>

<<Confirmation of a sustained market turn to the upside comes rather
predictably when the index makes a 1% on volume move, 3-10 days from
the most recent low in the down trend. . . . There can be false
signals, however, so don't just haul off and buy a collection of
stocks on the follow through day.>>

<<Resist the temptation to "think" about it, just count.>>

<<I look at the sentiment numbers for some confirmation.  Look for
sentiment numbers on the order of 52 week marks before marching
heavily into the market, even on a mechanically counted follow through
day.>>

I'm confused by your comments.  The count is mechanical, but it may
not mean much in terms of the sustainability of the move.  On the
other hand, confirmation of a sustained move is predictable.  But
these signals can be false.  But one shouldn't think about what one is
doing, though one should look to sentiment numbers.

In what ways do you find all of this less vague and more reliable than
charts?

- --Db






_________________________________________________________
DO YOU YAHOO!?
Get your free @yahoo.com address at http://mail.yahoo.com


- -

------------------------------

Date: Fri, 31 Jul 1998 20:18:17 EDT
From: <[e-mail]>
Subject: [CANSLIM] earnings release dates and sec filings, and insider buying .

Hello group,

I heard off another discussion group which is not nearly as reliable as this
group that there is an SEC regulation regarding posting earnings results.  My
question is what is the SEC regulation and if companys report earnings late
after the quarter ends, is it normally due to having a bad quarter.  Another
question is if there is no news released between earnings by the company is it
generally a bad sign.


Also if insiders are buying stock are there any things to be concerned about,
such as number of shares being purchased and during which quarter the shares
are purchased.

Any advice would be helpful and appreciated.

Thanks

Frank

- -

------------------------------

Date: Fri, 31 Jul 1998 21:14:12 -0500
From: Dave Cameron <[e-mail]>
Subject: Re: [CANSLIM] follow through day calculation

Ditto to Mike's comments.   I'm letting my individual stocks take me out.   I
sold one at a loss, and am about 70% invested.

Dave Cameron
[e-mail]


Mike Lucero wrote:
>
> I'm trying not to ignore M, but I'm still half invested, after being 150%
> invested on Monday. I thought I'd do better by selling when stocks
> invidivually (when each stocks rallied and failed, or broke local
> resistance) rather than selling everything all at once.
>
> Mike
>
> > -----Original Message-----
> > From: [e-mail]
> > [mailto:[e-mail]]On Behalf Of Tim Fisher
> > Sent: Friday, July 31, 1998 9:12 AM
> > To: [e-mail]
> > Subject: Re: [CANSLIM] follow through day calculation
> >
> >
> >  Seriously now, is anyone here
> > ignoring M and still in up to the hilt? I'm in cash except for
> > index funds and
> > a worthless stock.
> >
>
> -

- -

------------------------------

Date: Fri, 31 Jul 1998 17:55:22 -0400
From: Jeffry White <"[e-mail]"@sover.net>
Subject: [CANSLIM] follow through day confirmation - Mike Lucero

Mike,

Take a look at April 15, 1998 on the Nasdaq.  We followed through with
1% on volume 5 days after the most recent low.  However, sentiment was
running at near 5 year extremes. (Bears made that mark at 22.6% on April
6, 1998 and Bulls set a 52 week mark on April 27).  Then on April 22 we
had a giant distribution day, and the whole shooting match was over
until June 23.

Jeffry



- -

------------------------------

Date: Fri, 31 Jul 1998 21:38:23 -0400
From: "Nelson E. Timken, Esq." <[e-mail]>
Subject: RE: [CANSLIM] earnings release dates and sec filings, and insider buying .

Just curious Frank...which group was that?
Nelson E. Timken
http://onelist.com/subscribe.cgi/investing-list

- -----Original Message-----
From: [e-mail]
[mailto:[e-mail]]On Behalf Of [e-mail]
Sent: Friday, July 31, 1998 8:18 PM
To: [e-mail]
Subject: [CANSLIM] earnings release dates and sec filings, and insider
buying .


Hello group,

I heard off another discussion group which is not nearly as reliable as this
group that there is an SEC regulation regarding posting earnings results.
My
question is what is the SEC regulation and if companys report earnings late
after the quarter ends, is it normally due to having a bad quarter.  Another
question is if there is no news released between earnings by the company is
it
generally a bad sign.


Also if insiders are buying stock are there any things to be concerned
about,
such as number of shares being purchased and during which quarter the shares
are purchased.

Any advice would be helpful and appreciated.

Thanks

Frank

- -




- -

------------------------------

Date: Sat, 1 Aug 1998 11:05:26 -0400
From: "Tom Worley" <[e-mail]>
Subject: [CANSLIM] "M"

As one further comment from a lurker on "M" as it applies to CS type
stocks, there were only 87 stocks in the Daily Graphs books that hit a
new high this past week. Don't remember when the total was last so
low.

Tom W



- -

------------------------------

Date: Sat, 1 Aug 1998 12:22:59 -0400
From: "Nelson E. Timken, Esq." <[e-mail]>
Subject: RE: [CANSLIM] "M"

Probably the last bear market, Tom. Losers outnumbered winners 3-1 on
Friday. The only winner last week I can recall was Clorox, which surprised
with good earnings and went up 8. The only way a stock goes up significantly
is to announce earnings far exceeding those expected...then you get heavily
rewarded. But announce poor earnings or that things are slowing (ala PG) and
watch how they mow you down. It's brutal out there.

Nelson E. Timken
http://onelist.com/subscribe.cgi/investing-list

- -----Original Message-----
From: [e-mail]
[mailto:[e-mail]]On Behalf Of Tom Worley
Sent: Saturday, August 01, 1998 11:05 AM
To: [e-mail]
Subject: [CANSLIM] "M"


As one further comment from a lurker on "M" as it applies to CS type
stocks, there were only 87 stocks in the Daily Graphs books that hit a
new high this past week. Don't remember when the total was last so
low.

Tom W



- -




- -

------------------------------

End of canslim-digest V2 #346
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