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Registered User
Joined: 11/10/2004
Posts: 21
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Whilst all the good knights do joust and parry (and me thinks more with the ladies than with the markets), I am wondering what thoughts the villlage people do have about the current investing environment. I have seen/heard quite a few comments/articles in the media saying the housing bubble is perilously close to busting. Be that as it may, Congress passed, and the President signed new bankruptcy laws, making it harder for individuals to get out from under debt. Add in to the mix the trade deficit, with the US Treas reliance on Asia to buy its paper every quarter, and growing concern about the reliability of those investors. Further, our good Fed captain insists that tax increases be a part of any move to balance the federal budget, and assures us that higher interest rates will come. And while 'private accounts' for Social Security look dead in the water, one has to wonder about the true motivation behind such a move. Is it only just a way to reduce the Fed liability by shunting it into the market?
This idiot sees at best stagnant range bound markets. Classical market analysis (of which I know little) viewed the market as an indicator of coming economic activity. With the current markets heading down, this does not bode well for Q2 and 3. At worst, I hope the mortgage is fully paid on the castle and grounds. I try not to be cynical about the motivations of our leaders, but as all good knights do know, 'tis the deed, not the word, by which we are ultimately judged.
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Registered User
Joined: 12/2/2004
Posts: 1,775
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tfelts, for all the various points you make about the market, full vincication for me on why I use telechart. To find early stage price breakouts combined with volume for the particular stock. In otherwords, trade what's before me and don't worry about predicting or worrying about current or future market trends. And above all practice disciplined trade management (Do not ditch my stops). Yes, I know a major market swing/trend affects most all stocks, but that can also be a period when telechart most easily points to individual stocks marching to their own beat. Having said that, yes, I do also have part of my portfolio in long term investments vs. swing trades, but am becoming more and more confident in telechart and my ability to utilize its strengths.
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Registered User
Joined: 12/24/2004
Posts: 3
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this comment is specifically for FPETRY. Couldn't find a way to send a direct note to you so apologies for this off-topic post.
On your last note here you mentioned finding early stage price breakouts (my holy grail):) and for the life of me I can't figure it out. What search options do you use to find this out?
Thanks in advance and again apologies for the off-topic message :)
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Registered User
Joined: 12/2/2004
Posts: 1,775
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Hi jcepeda. I'll try and give you a general thumbnail on my style of finding breakouts. ARRS is a stock I just bought 4/28, and it has the classic pattern I look for…high volume that particular day with the price penetrating generally well defined trend line and/or resistance that has formed for a few weeks or more. Note the basing/sideways action since Jan., particularly well defined basing since mid-Feb. I also like that it’s trading above the 50 and 200 SMAs. Early stage because I catch the breakout early, as it’s happening now, via telechart intraday scan of course. And also early stage in what I think is longer term potential. In other words, the stock has not made a huge move, like say from $7 to $20 in a few weeks as an example. And I also prefer stocks below $35 because in general I think they have more potential for greater percentage moves vs. say a $50 stock that has matured over time. Always exceptions of course, but I’ve got to find a style I like and that helps yield a relative small number of stocks that I can study. My cutting out all stocks above $35, that’s quite a chop but also quickly cuts my workload.
You ask for my search options. I use several scans/pcfs, but a basic one I use for finding long breakouts is: C > (C1 * 1.025) AND V > (AVGV20 * 1.5). This scans for any stock up 2.5% or more that day, with volume that day of 1.5x or more the 20 day average. After entering and calculating that base pcf, I then add conditions, such as stocks with price of $4 to $35, with 90 day average of 200k shares or more. There are other conditions I’m always adding, removing, tweaking, but this is may base and the scan I use for early in the day. For end of day scan or late in trading session I use a similar scan but one that only shows stocks up 4% or more and trading 2x average daily volume for past 20 days.
Now comes the hard part, as my scans don’t conveniently show stocks breaking out of well defined congestion or trendlines/resistance. I usually get a manageable number of anywhere from 20 to 50 charts at end of day using above formula, and then start hitting my space bar and eye-balling each chart.
By the way, I’m no telechart guru or expert, or trading expert. My simple scans are result of trying scans I’ve borrowed from others or created myself. I got too complicated for a while and have slowly migrated to the “less is more” and “keep it simple stupid” crowd. My charts used to have half a dozen indicators, but all I usually use now are daily candlesticks with default zoom set at 7 mos. (zoom 4), volume bars, and 50 and 200 SMAs. My theory on this is that I like to work my eyes fast when sorting quickly through charts, and with a lot of clutter on them it slows me down. Different strokes for different folks:)
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Registered User
Joined: 12/2/2004
Posts: 37
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Markets discount future economic conditions. The '04 Q3/Q4 rally was DOA. Historically low interest rates -> major mortgage refinancings. Expectation = long term, more disposable income to fuel economic growth. After short term economic pop we have lowest growth in two years.
Major tax "reform" -> more disposable income to fuel economic growth. Benefits accrued to highest wage earners/corporations. Who fuels economy? Joe Public. Regular consumers. Not the highest wage earners/corporations/high net worth entities! The "death" of the Federal "death tax" simply transfers deficit responsibility to future generations and the less wealthy. Think about it. Finally, the new 800-lb. gorilla in the global economic "war room" is China. Who will be the global economic powerhouse in the next decade? "Fixing" Social Security, "reforming" taxes, "moral" leadership, a "drilling" for energy independence position (not a policy) from our government are simply moving deck chairs on the Titanic. This economy is in for further downward "adjustment" with or without Washington's help. Just look around. What do you see down the road? Draw your own conclusions. You don't need the pundits opinions. Observe. Balance with experience. Ask, what has been done/needs doing/needs to happen to propel this economy forward. Decide. Then, invest accordingly - of course with protective stops.
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Registered User
Joined: 10/7/2004
Posts: 2,126
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Well said Tomg18. It is in fact simpler than it looks if you just stop to look around you for a second.
The new 800-lb gorilla is going to do lost of pushing for a long time, in fact long enough that the biggest gorilla now may get pushed over and stepped on. And the chairs on the titanic are not even well positioned.
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