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JoeGrossinger
165 posts
msg #29655
Ignore JoeGrossinger
11/5/2003 4:08:11 PM

DCUT does have some technicals in it's favor but the big negative is that the 25 & 50 DMAs are in such a steep decline and are stiff resistance.
Notice that DCUT has bounced down the last 2 days from the 25 DMA confirming it as resistance.

================================================================================

I guess that explains why stocks never move up in a straight line and hardly ever move down in a straight line.

For every buyer there is a seller and that means two folks see the same facts in totally different ways.
The things you look at never come to my mind. I ignore them because a stock always has to climb a wall of worry and on the way down it always has to overcome optimism and hope.
The only things I look at are the major moves and trends. What happens tomorrow no one can say and I won't try to predict day-to-day moves.
I only worry about major trends and signals.
In the case of DCUT, the double bottom is being formed, the MACD is positive and the trendline is intact even with today's drop.
Worst case a cup and handle is forming and best case the W will be completed this week.
Where the stock will be tomorrow is impossible to tell. I know it's going up and that is what I go by.
Just as in the case of LOOK, NVDA and some others, the day-to-day is impossible to tell but the trend is easy enough to spot.


EWZuber
1,373 posts
msg #29656
Ignore EWZuber
11/5/2003 4:25:50 PM

My post was in no way meant to be a slam on you or the stock you chose.
It was a strictly emotionless technical analysis based on the system I use and was not altered in an attempt to find something wrong with your choice. I was simply trying to lend insight into the stock and let you know why it is doing what it is doing in my opinion. I was going to post a warning about the 25DMA in a downtrend a couple days ago but decided not to because I thought you would take it as a hostile statement.
NVDA is right on track and doing as expected, holding its 1 month uptrend above the 25 Week MA and trendline support.



JoeGrossinger
165 posts
msg #29657
Ignore JoeGrossinger
11/5/2003 4:47:14 PM

Why do you take every rebuttal personally?
I simply outlined the different approaches to TA that you and I so very obviously take.
I maintain there is no precision and there is no way to accurately predict day to day moves of the stocks or markets.
I used a couple of stocks where we already went over this territory in some detail and it's not my fault your analyis on them proved wrong.
What I was trying to tell you is that DCUT can go down some more and it won't affect my view unless and until the major indicators go against me. As long as DCUT does not close below .085, as long as the MACD is positive and as long as the general trend is up, I consider the uptrend to be in place.
That is the same analysis that caused me to question you on LOOK and NVDA and to tell you the truth, I am right far more often than not because I take a longer view and don't pay any attention to support and resistance except to know why a stock may sputter before it moves on. Stocks cut through moving averages and stupport or resistance all the time. They are only temporary resting places. It's the aggregate of major trend signals that I go by.
If a 20/50 moving average crossing had any major signifance one could write a filter for that and get rich. The truth is that it's not all that significant.
Nor is the closing above or below the 20 day moving average. No filter that looks for that works in either direction.
So, I ignore the minor stuff in order to not get tossed off the hoss and stay with the major trend. If it turns sour then I'm gone.

The exception is stocks like MCWEQ where I bought and sold in the same hour yesterday. That is a beaten down dog that chances favored a dead cat bounce and I profited from it using what Avery calls money management and I call snatch and drop speculating. I don't even bother to do a chart analyis on these. I just buy the ones that are down 35% or more from yesterday and dump them when I'm in the money and move on.

Different approaches to different stocks. Not all situations call for the same approach anymore than the same line works for all girls nor the same kind of driving technique works for all cars and bikes.

I only really know these two methods where I either go with the major trend when a stock signals a major trend reversal, as in the case of DCUT or I go for a dead cat bounce when a stock is taken out and shot.




JoeGrossinger
165 posts
msg #29658
Ignore JoeGrossinger
11/5/2003 4:51:58 PM

I should add that I only play the dead cat bounce once with the stocks that get killed. I don't play it again on that same stock. Ever. MCWEQ is back to .06 but I'm not going to touch it because the market has had time to look at it and it can actually do down more now. That play is a one-shot-per-stock play for me.



TheRumpledOne
6,358 posts
msg #29659
Ignore TheRumpledOne
11/5/2003 5:25:58 PM

"JoeGrossinger 11/5/2003 4:47:14 PM

Why do you take every rebuttal personally?
I simply outlined the different approaches to TA that you and I so very obviously take.
I maintain there is no precision and there is no way to accurately predict day to day moves of the stocks or markets.
I used a couple of stocks where we already went over this territory in some detail and it's not my fault your analyis on them proved wrong."

This is NOT about right/wrong... this is about profit/loss. Simple.

After you buy a stock it either goes up, down, or nowhere. Those are the only 3 outcomes. If the stock goes down, but later advances the next minute, hour, day, week, month, year... Does that make you right? NO! It may make your profitable but not right.

So unless you put a time limit on when your picks as supposed to be profitable, the arguing is pointless about who is "right".



JoeGrossinger
165 posts
msg #29663
Ignore JoeGrossinger
11/5/2003 8:20:17 PM

Absolutely wrong Avery.
As long as a trend is intact it would be wrong to get out of a stock and when the trend no longer is intact then its time to get out and it would be wrong for a trader to stay.
The time frame is determined by the selected trend. A couple of weeks when using a daily chart is not all that long, while a couple of days on a 60 minute chart would be forever.
Nothing is precise or clear cut in TA.
You buy a stock based on a major trend on the daily chart and then if the stock goes down for two days but the trend is still intact and you get out then you are wrong because in most cases the stock recovers and continues to climb.
Sometimes folks neglect to get out when they should and then end up sitting under water for weeks. That is just as bad because you should be going with the trend and should know before you buy where the exits are.
If you find yourself getting out just before a stock rises then its because you don't know when a trend starts and stops.
A lot of traders have problems with that.
You can tell by Zuber's day-by-day account of stock action on the other threads that it's pointless to try and do a day by day. It does not work.
I'm just wondering when he is going to catch on to that fact.
How many times does a person have to be proven wrong before they change tactics?
When it comes to money, not very often for me.
Right now DCUT is a good example of this.
If tomorrow the stock closes below today's close it will be time to get out, if not then it must be presumed that the intermediate trend is intact and the trader should stick. Personally, I think it declined because it was short term overbought, which is now no longer true and the stock should rise tomorrow.
The RSI(2) was very deep in overbought territory yesterday, but I remained in the stock because RSI(5) was less than 70. I expected a pullback and got it.
A nimble trader could have jumped in today and bought more based on that, but I chose not to because RSI(2) is of extreme short duration not even lasting a full day at times.
Not all rules apply at all times. It all depends on why you bought the stock in the first place and what trendline you are following.


EWZuber
1,373 posts
msg #29666
Ignore EWZuber
11/5/2003 8:52:26 PM

It seemed personal, but for the sake of peace I'll call it my mistake.
Since Technical Analysis uses indicators they will never be completely without error because they are technical indicators not technical laws. You will always be able to find fault with my system or anyone elses system of chart analysis. There are no exceptions.

I guess you don't consider the NVDA trade a success but I called NVDA as an entry dead on trendline support @ $16.84. It bounced up off this supporting trendline and has not tested it since, closing today at about +8% above the entry. This position would have been in the money since the moment it was opened. Can't ask for a better entry than that, IMO. The stock is on track holding above long term support at the 25 Week MA and short term support at the 25 DMA and Daily chart stochastics are +crossing over. Looks good.

Same with WGAT, called the entry to the penny @ $0.44 back on August 27th and called it as a big winner with excellent long term potential.
Its up +150% as of todays close. Correct short and long term call.

Called BCON as a big short term winner on 9/12, saying it could 'really take off Monday', It took off Tuesday and by Wednesday was up +98%.
"EWZuber 9/12/2003 9:18:58 PM
This thing could really take off on Monday morning just on the technicals alone.
I wouldn't hold it though. I would sell on any spike that is so violent it doesn't produce a supporting trendline. Cause then it has no support to hold it there."
Thats exactly what the stock did and it has gone successively lower since then.

Are these indicators right every time? No. But results like these don't happen by chance and they are reliable enough to perform trade after trade successfully.
Since the LOOK transaction my account is up +27% without one losing trade.
So there's no need for third party validation of the accuracy of the system.

There is precision to TA and it's ok if you do not recognize this. I can accept that as your viewpoint.

I agree about MA crossovers, I don't consider them important either, and have never made reference to them as an indicator.
However, what is considered to be 'major' or 'minor' is strictly in the eyes of the beholder.
Give one person a tool and he may find it meaningless.
Give it to another and he may do awesome work with it.
I never considered RSI to be usefull for much of anything but Avery and others have seen potential in the indicator where I did not.
Thats probably why there are so many different indicators.

Anyhow, I noticed that you are using $0.085 as a possible indicator for holding/closing the position. Trendline support for DCUT is at $0.081 ( & rising ). This could be significant should the stock test trendline support.

It is true that stocks break through moving averages all the time, however it is unusual that they break through MAs that are in steep downtrends and if they do there is usually no support to hold them there.
Reviewing the history of DCUT for technical precedent you can see that during the period from 11/2001 to 6/2002 the 50 DMA was in a predominantly steep downtrend and was stiff resistance. Nearly every time during this 7 month period the stock came up against this MA it bounced down. When it did manage to close above it one time, the stock broke down quickly and continued the downtrend. I find it important to acknowledge an indicator of resistance that is this consistent and reliable.
Notice that DCUT finally broke above the 25 & 50 DMA on 11/04/2002 after a considerable period of consolidation and at this time the MA was flat and could now be used as support. After the break, the stock dropped to test support at the 25 DMA and with this MA now in an uptrend it was suitable as support and it held.
Then again beginning in Jan. 2003 the 50 DMA once again became stiff resistance just as before forming a new long term downtrend.

If you recall when I was demonstrating the chart analysis of NVDA I said that if the stock did not gap up to the 50 DMA it would drop along the 25 DMA because the 25 DMA being in a downtrend and could not suffice as good support. Well, the market had a really bad few days and this kept NVDA from gapping up to solid support and sure enough for 4 days NVDA slid right on down the decsending 25 DMA until it fell upon the 15 DMA which was in an uptrend and here it bounced up off this support and has been moving higher on it ever since.

So moving averages are much more than minor indicators, the key is to realize the power that lies within them as indicators. or not.

Stochastics would support a longer term move higher in DCUT but the stock may need help from some improvements in the fundamentals.

The 15 DMA is DCUTs best chance being a short term indicator and already showing a slight uptrend.
Right now the stock is being squeezed between the descending 25 DMA @ $0.105 and the rising trendline support @ $0.081 causing the stock to form a short term wedge pattern. These two support and resistance areas will soon meet and something will have to give.
DCUT closed below the 15 DMA now at $0.092 and IMO, it would be good to see the stock close above this very soon to preserve the uptrend of the MA for expediency.
But thats just my humble opinion.


JoeGrossinger
165 posts
msg #29671
Ignore JoeGrossinger
11/5/2003 10:26:35 PM

The main difference as I see your opinion vs mine and vs Avery's is that of time frame. It appears to me that Avery has about a 2 minute time frame, your's is a bit longer and mine is longest of all.
For me, the time frame determines how wide the trendline can be. A very short time frame demands a very narrow trendline, while a longer one can be drawn with a magic marker.
So in a sense we can all disagree and be right or wrong at the same time.

No, for me NVDA was a no buy because first of all it was not and is not coming out of a intermediate trend reversal, so from my point of view it can go anywhere although the general trend of the stock is down.
Indeed, you can make money on the dips and peaks but that is not my style.
I prefer to catch a stock as it's coming out of a pretty clear bottom formation.

MCWEQ is also a no buy but that was a special exception in that the dead cat bounce is as close to a sure thing as one can get. But generally, I stay with a stock for 2 - 3 weeks and end up doing fairly well with not much sweat.
However, you are right about DCUT in that it is getting close to the decision point, but depending on how it acts tomorrow, I may add not take a way from my position in it.
When we discuss stocks and TA I try to be dispationate about it and will be as frank as possible. I don't generally engage in personalities unless provoked but I realize I can be without tact when discussion what to me is obvious.
I'm not always right and when I say I don't agree with your opinion I am definitely not saying you are stupid or don't know what you are talking about. It simply means from my point of view and coming from my time frame I don't agree with you.
If you think I am coming after you let me know and I will try to rephrase my post or lay low for a while.
It's not my intent to make enemies and I do like discussing TA, especially with folks that don't agree with me and are not afraid to say so.



TheRumpledOne
6,358 posts
msg #29687
Ignore TheRumpledOne
11/6/2003 10:13:24 AM

1) About 99% of the arguments I had in my adult life were futile and could have been avoided had I realized that “- there are ideas and values that most people accept, and it is pointless to argue.” “The reason arguments do not work is that most people hold their ideas and values without thinking about them. There is a strong emotional content in their beliefs: They really do not want to have to rework their habits of thinking, and when you challenge them, whether directly through your arguments or indirectly through your behavior, they are hostile.” That comes from THE 48 LAWS OF POWER, by Robert Greene. Wish that book was available back in high school/college… would have saved me (and perhaps you too – lol) much grief.
2) Similarly, “Experience has shown that reason and logic can never change perceptions, emotions, prejudices and beliefs. Yet we continue in the pious hope that if everyone would ‘see reason’ the world would be so much better. As we shall see later, there are very good reasons why logic will never affect emotions and beliefs. The only way to do this is through perception. But we have totally failed to develop an understanding of perception.” That is from I AM RIGHT, YOU ARE WRONG by Edward DeBono.
3) From a life experience, I have learned that ASSOCIATION is the key to everything. It is never the THING but rather what one ASSOCIATES with the THING that’s important. One person sees the flag and feels patriotic, while another feels disgusted. It is not the flag that causes the feeling, it is the associations the person makes. That answers just about every “WHY” question there is as far as people are concerned. Why do people do, act, and think the way they do? It’s the associations that they make! Find a person’s associations and you find their key.

"There is not right and wrong - only thinking makes it so"

"YOU CAN LEAD A PERSON TO KNOWLEDGE BUT YOU CAN'T MAKE THEM THINK"


TheRumpledOne
6,358 posts
msg #29688
Ignore TheRumpledOne
11/6/2003 10:15:08 AM

"It appears to me that Avery has about a 2 minute time frame, your's is a bit longer and mine is longest of all."

It is comments like the above that starts S**T, Joe G.

Why don't you buy a vowel and get a clue?




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