In a recent report you stated "just minutes after that we saw the first green bar on our realtime NASDAQ chart appear." What program are you running that gives you this signal?
At times you refer to overhead supply. What is it? (April 10, 2000)
With respect to playing puts, I am interested if there are good signs to look for to see tops and movement down. (April 12, 2000)
Is there a web address to track Nasdaq volume during trading days, and compare that volume to past days? What about volumes on individual stocks? (April 19, 2000)
Often I see options that are falling in price though the stock itself is actually rising in price .... I don't understand why? Can you help me? (April 19, 2000)
Regarding stop orders, I have been told that if I place a sell stop order, the market makers may "dip" down and take me out of my position even though the bid may be higher. Because of this, I haven't placed official sell stop orders, yet because I haven't I have lost more money on some trades than if I had placed the orders. Also when do you use sell "stop orders" vs. sell "stop limit orders"? (April 29, 2000)
How do you identify when a stock has started back up after a fall? (May 13, 2000)
I would like to have an explanation about your references to a put to buy versus a put to sell, and a call to buy versus a call to sell. (May 15, 2000)
You often mention a stock basing (i.e., building a base) or a stock consolidating (i.e., laterally). What is the difference in the two, if any? (May 16, 2000)
In an earlier report this week you mentioned about 30 trendlines on the Nasdaq. Is that normal? (May 18, 2000)
What is the significance of advancing versus declining issues? (May 25, 2000)
How do you know when the best time to sell an option is? Is there a doji for selling in addition to buying? (May 31, 2000)
Where can I find the put/call ratio on the internet? (June 5, 2000)
I see some references to stock purchases, but most plays discuss options. I do not trade options. What should I use as my entry points for stock purchases on your plays? (June 5, 2000)
We had a few questions about calculating the return and the risk/reward on spreads. (June 24, 2000)
Is it possible for you to be more specific about where we should place the stops? For me this is the hardest part of the buy/sell routine. (June 27, 2000)
If I buy stock and write covered calls on the stock, can I then place a stop loss on the stock? Then I could protect my downside by selling the stock when it goes down, and then buy back the ‘naked’ call at a low price? (June 27, 2000)
Your stock recommendations seem to focus strictly on recent performance of the stock, not necessarily on the fundamentals, i.e. PE ratio, revenue growth, etc. Many of the stocks you reference have "Hold" ratings by other brokers. Is this because your strategy is limited to short term option plays? (June 28, 2000)
How can you put stops on options? (June 29, 2000)
Is there any place I can find option deltas on the web? (July 1, 2000)
What is a trailing stop? (July 1, 2000)
How do the Aggressive versus Safer plays work with respect to positions? (July 3, 2000)
In reading the Q&A’s, you say you use a simple 50 day moving average, but from the reports it appears you are using exponential. Is there a reason? (July 8, 2000)
What is a good rule of thumb for setting stops? (July 8, 2000)
How much of a move can be expected on a breakout of a cup with handle pattern? (July 10, 2000)
How can I find timely information on money flows into mutual funds? (July 10, 2000)
Is there a reliable site that you can find the dates and time of day (before, during or after market hours) companies are scheduled to report earnings? I can't find one that is reliable. (July 18, 2000)
Is there a ‘bible’ for technical analysis? (July 22, 2000)
What is the best realtime data provider? (July 22, 2000)
When you are determining Price/Volume action on a stock, lets say the price is up, volume is down, but still above average. Is this considered negative or positive because volume is above average? And vise versa, Price down, volume up but below average? (July 22, 2000)
Why do you ignore the presence of the 50 day simple day moving average? [In] 1996 . . . throughout that year the 50 SMA served as support . . . in several instances, from January through September. (July 29, 2000)
What is the difference in the money supply indicators the Fed releases? (July 29, 2000)
Could you advise me on some sort of formula on when to sell a stock? Do you keep it for a certain length of time or do you sell after it reaches a certain percent and what percentage would you sell? (August 5, 2000)
What is a good computer system for day trading? (August 5, 2000)
Is there a website that you use to track the moving averages for volume on the Nasdaq and NYSE? (August 8, 2000)
What happened to all of the buying volume last Thursday? Were not the institutions buying? (August 9, 2000)
When you list a certain credit for a spread but the stock moves up and the spread is no longer there, do you continue to chase it or pass? (August 22, 2000)
In the Daily you recently mentioned realtime services and in particular eSignal, which seems to be your preferred one. I have been using PCQuote 6.0 . . . I never heard you mentioning it, though, which makes me wonder; is it because you don't know about it or because you consider its service poor (doesn't look like it to me, although it might be considered pricey). [C]ould you please tell me how does it compare with eSignal? (August 22, 2000)
You often mention money flow. Where do you derive this information from? (August 23, 2000)
I use Telechart 2000. Where can I go to get other indications for money stream and balance of power? (August 28, 2000)
When you say a stock is a buy up to a certain price on a move, why do you limit the buy point? Is the limit your short term target? (August 30, 2000)
There is something very confusing to me that needs some attention. Two nights ago you said safer buy on EXDS would be over 67 with over 8 million shares. Yesterday it closed at 67 7/8 with 8.8 million shares. Last night’s letter said the safer play was to buy EXDS at 73 with volume at 11 million shares. I am in at 54 but how come you don't say, now that EXDS went over 67 with 8.8 million shares, anyone that wanted to buy that stock should be in already. Instead you upped the buy price. I just don't get it. (August 31, 2000)
Where can I find the VIX and Put/Call ratio intraday? (August 31, 2000)
How can I determine if the volume of the day (or intraday) is from buyers or sellers? Is this indicator available or do you just assume based on the price going up or down? I know that Level II quotes give a picture of the current queue. This may be irrelevant if the price is all I should be concerned about. (September 2, 2000)
I have been trading options for a number of years, but I have never traded a credit or debit spread. If I write an out of the money put and buy a further out of the money put and the price of the stock goes below the put that I have written am I stuck with buying the stock at the strike price? (September 5, 2000)
I notice you advocate 7-8% stop loss orders after purchase. As the position works out do you recommend adjusting the stop loss to maintain the 7-8% or something else? (September 6, 2000)
I believe that your recommendation strategies below are for both for buying stocks and options. I only know how to buy stocks. I didn't seem to able to distinguish your advice from stocks to options. Can you help me out here? Thanks. (September 9, 2000)
You talk about selling calls on long-term positions and then buying them back. How does that work? Right now I have 200 shares of JDSU. As you have noted the stock has been weak of late. There is an analyst meeting on 9/12, which I hope will boost the stock. I am willing to sell some December 135's. If the stock were to go down can I buy these back for a profit? If so do I sell to open or close, and then conversely buy to open or close. If the stock goes up I am happy with selling the stock at $135. So, is this a way to hedge my position. (September 11, 2000)
After reading Subscriber Questions on stocks & options I have a question. Were can I find out how much an option will go up (or down) as compared to the stock price? (September 11, 2000)
I really enjoy your comments and have learned a lot about the markets over the past few months. I would like to know if when you select options you give any thought to the option’s intrinsic value and time value, i.e., do you want a certain percentage one way or the other? Thanks again for great advice. (September 12, 2000)
Where can I look to see the futures? I would also like to watch them, but don't know where to find them. (September 16, 2000)
What is the meaning of team trades? The information from what I see comes out after the fact, which team are you talking about? (September 16, 2000)
Where can I find the VIX on a daily/hourly basis? (September 18, 2000)
You have remarked often about cutting losses on new positions to 7 to 8%. My question is when is the position no longer considered "new"? An example of what I mean is let's say that I have owned a stock for a month or 6 weeks and it's moved up and down and then after being up 6 to 10% it drops down toward the original purchase price, do you recommend setting new stops at any immediate rise in price, or should I just keep the original 7 to 8% stop in place? (September 19, 2000)
Could you explain the difference between money flow and buying? (September 20, 2000)
I usually see your evaluation of Aggressive and Safer to be 180 degrees from mine...I sure wish I could understand your reasoning specially with today's VRSN example. (September 23, 2000)
Just want to ask your opinion on something we learned in a class we took. Being that INTC has taken such a big hit (called a slam in class). Why would we not do a Credit Spread (Bull Put Spread in class) on it since it is still a great company and should have found support at these prices. Maybe a 40 and 35 spread?? If you have time your comment would be very much appreciated. (September 25, 2000)
In [the September 28] newsletter . . . under "Our plan" heading, Mr. Johnson writes "... we will look for stocks that are trading back near support and those that made good moves today but show early weakness." Could you tell me how to do that? (September 30, 2000)
Everyone including yourselves say that stocks like DELL and INTC are the "old" leaders and will not lead again at least in the near future. I know by your writings that you have a large position in DELL and probably in INTC as well. Did you sell your positions? Are you holding these positions and waiting? What is your strategy if they begin to rise or fall (I know one is writing covered calls and/or buy puts on a fall and buying calls and/or writing puts on a rise). Will you sell into strength if they start to rally? I can see both DELL & INTC going down even further if they do not make a rally attempt in the next couple of months, particularly when tax selling time rolls around. What should be done with these positions if an investor just purchased them a couple of months ago and got caught in the down draft. Both were purchased as long term holds, but now things are not looking so good for these two companies. Seem to always be late to the game. I do believe INTC will be OK in 6 months to a year, but I'm concerned about DELL. Opinion please. (October 7, 2000)
Where can I find out what institutions are buying or selling a stock? Are sites updated daily, weekly? Where can I find out what is an average daily volume for a stock? Where can I find out the volume movement throughout the day? (October 9, 2000)
How do I find out the 10-days, 15-days, 50-days or 200-days moving average for a particular stock? I see above terms being mentioned from time to time. How do you derive this and do you need special software to provide such function? (October 10, 2000)
Do you have any suggestions for a charting service similar to Quote.com that could be used with eSignal? (October 11, 2000)
I am new to technical analysis trading and had a couple of questions. I like your newsletter a lot, but am unsure when to enter a trade. Can you explain the difference between rising, sound, and heavy volume? Also, what do you mean by a continued bounce? These terms are a little confusing and leave me wondering exactly when I should jump on a trade. (October 12, 2000)
On your daily letter 10/12, you said "Indeed, after hours today, even more impressive earnings were out..." Where is the best place to dish out the information such as: a) after hours of stock market; b) check out the earning news after the bell? (October 14, 2000)
It is very important to me to be able to get the same volume reports that you are working with. I cannot presently do this with my charting service. Please, which charting service are you working with to cite your volume figures. What range do they work with (i.e. do they draw from all exchanges, etc.)? (October 16, 2000)
The following is an Oct. 04, 2000 quote from Michael Murphy: "What you need to decide during times like this is whether you are an investor or a speculator. If you are a speculator, you buy popular stocks at high valuations that are moving up, in hopes of selling them to a greater fool at a higher price. You must ignore measures like price/growth flow or price/earnings ratio, because they will literally cause you to do the wrong thing. You should be looking for new buy ideas in the New Highs list. Most important of all, you shouldn't kid yourself about what you are doing. To you, a stock is a piece of paper and investing is like playing Hot Potato or musical chairs--it's a game, and not one that we want to play. If you are an investor in the new economy . . . you are trying to associate your capital with great companies at low prices. Stocks that are falling become more attractive to you, not less. You are looking for buys in the New Lows list, turning the volatility in tech stocks to your advantage by buying when they are depressed." I like your site. I also appreciate Michael Murphy. What would you reply or direct me to understand this issue of valuations: perhaps a book or an area on your site? Understanding this issue is critical to making wise choices for my investing future. (October 16, 2000)
In your newsletter you state buy points if the stock trades at or above a certain level. Usually these are the "safer" entry points. My first question is, once a stock trades at the buy point, how far should you let it run before it's no longer a wise choice to buy it? Say for instance, the buy point for AMCC is 208, and it hits that and keeps going. Would it be wise to still buy or let it go? My second is, if you were to buy AMCC at 208.5, then it drops back below 208 should you still hold or bail out? Should you hold as long as it doesn't drop by more than 7 or 8%? (October 21, 2000)
The 7% - 8% cut loss rule seems OK for stock purchases, is it also equally applicable for Options? (October 23, 2000)
The hardest days for me to trade are the days that the market and stocks in my watch list gap up big. I have tried several ways to play those, but often with not a lot of success. What is the method(s) that you use to play stocks that gap up big? (October 24, 2000)
At what site can I find the Nasdaq futures before and after the close? (October 28, 2000)
Where can I chart the 5 and 15 minute averages both for a stock and for the Nasdaq? (November 11, 2000)
Would you explain what the last two letters are in the option chain symbol? (November 11, 2000)
What parts of earnings reports should we key on? I see reports that look great but then there are follow-up stories about sales outlook, etc. that make the market perceive reports as negative. (November 14, 2000)
I follow your recommendations carefully and am not certain what I should do when a stock gaps up ten points away from your in-the-money call. Should I add $10 to your recommended strike price and use the same expiration month (assuming there is sufficient open interest) or stick to the recommended play? (November 15, 2000)
How do you figure where to put trailing stop losses? Do you use one of the moving averages? For example Juniper closed at 184 today. How would I know where to put my stop loss? I bought it at 159 7/8 on Monday as it bounced. I would rather let it run if it is going to, but I've let too many profits go south in the last 4 months. (November 15, 2000)
I saw in your newsletter . . . mention of watching QQQ . . . for a play. Do you have a particular method for playing this or OEX (S&P options)? (November 16, 2000)
What averages should we use to trade with? I use the 10 and 18. Should I use just one or which two should I use? (November 20, 2000)
When you speak of relative strength breaking out, is it Wilders RSI or relative strength of the particular stock versus the market? (November 21, 2000)
In options, when a stop is set to protect, what triggers the stop? Is it the bid or the ask? (November 21, 2000)
We have had a lot of questions about using the 5 minute and 15 minute moving averages intraday as short-term trading signals in a volatile market that makes riding positions for weeks at a time (our real preference) much more difficult (at least upside plays). (November 25, 2000)
How can small investors tell when institutions are buying or selling? (November 27, 2000)
Questions on Overall market stats - VIX and Put/Call ratio: Where do you get these numbers and how were they calculated? Is the Put/Call ratio calculated from a sample of batches of transactions or is that the actual total for a whole day of trading or a cumulative total? And who has access to these figures? (November 28, 2000)
When preparing the plays is there some reason you do not provide an estimated profit goal for the buy, i.e., we expect the stock to gain between $1.50-3.50? (November 29, 2000)
I'd appreciate it if you can tell me where I could get intraday data on the VIX index and put/call ratio. (November 30, 2000)
Do you use tracking of "up" or "down" ticks? (December 2, 2000)
What were the confirmation days on the Dow back in October? (December 7, 2000)
I am about to close on a new house December 29. I am not that much up on how interest rates work. I just know they are a little above 7 percent right now. What will happen to them if Greenspan lowers the rate by a quarter of a percent? And, how long does it take for mortgages for follow suit? (December 9, 2000)
Here are my questions in regarding some of your newsletter. 1) How did you find the "overhead supply" [when you stated] “CHKP has stacked up a healthy bit of overhead supply between 150 and 160.” 2) How do you check the future market, such as SP500 future market and so on? (December 11, 2000)
1. Why when you give buy points, is the higher strike price the safer play? I would think that the lower strike price is the safer play. 2. When owning an option on a stock, do you normally sell it when it goes 'out of the money' and re-purchase at 'in the money'? If not initially, is there a point at which time you will? (December 12, 2000)
Could you please explain why you have switched over to the April calls? Does something happen to January calls when options expire this week? Do they suddenly fall in price? (December 13, 2000)
Is there any way that the expiration of options this week has anything to do with the NASDAQ being down and in fact nothing is really going to happen till Monday? (December 14, 2000)
I do not understand how QQQ options work. Exactly how are they priced? Can you please explain. (December 18, 2000)
What do you consider to be sufficient open interests for an option? (December 18, 2000)
When people write or talk about "capitulation" in the market, what do they mean? (December 19, 2000)
How do you use "Trailing Stop-Loss" techniques? (December 23, 2000)
You noted there were only 70 open interests on JNPR February 120 calls; thus, it might be harder to trade the options. Can you explain this? (December 26, 2000)
Is there such a thing as SDS (same day substitution) on an option? It seem that in one of my classes we were told that we can get out of having a stock that we have sold a put on, being put to us using the SDS. I told my broker that I wanted to buy back the put so it was not put to me but he said it could not be done. (December 26, 2000)
What are you referring to by "down trendlines", and exactly what do they represent? You seem to refer to them being of importance when a stock is in the midst of heading "upward". Are these points of resistance? (December 27, 2000)
Our discussion of trailing stops earlier in the week brought this response from one of our subscribers about using trailing stops on ECN’s. (December 28, 2000)
I have lost some of the gains because there is not much advice (certainly not in simple terms) on when to sell. Can there be more information that would include some selling guidelines? (December 30, 2000)
When you say "position stock or option", are you saying stock purchase on cash and\or margin when dealing with stock? Also, so much of your newsletter deals with options and I lose confidence when thinking about purchasing on margin. I understand your 8% rule and I guess a cash or margin purchase would follow these same guidelines. Would you please clarify your advice on this matter. (January 2, 2001)
On last weekend’s report you referenced large volume spikes in certain key stocks right before the close. Where can I find this information on real time volume information? Do you subscribe to a chart service where you are able to watch the volume on each of these stocks? I am unable to see volume spikes with my software on my watch list. (January 2, 2001)
There is a concept I do not understand and I cannot find a sample response in the Q&A section. If a stock is in an uptrend, will the average value for the 200 day Moving Average (MA) be greater or lesser than the 50 MA and will the same principle hold when the stock is trending down or decreasing in price? (January 3, 2001)
Can you give me some guidance on trading the QQQ? I have occasionally gone long or short depending on the market, but I find that the QQQ doesn't seem to move as much as the market does. Today I shorted the 55 Put when QQQ was at 55. I closed at the end of the day for a profit, but it was very small. Less than a point. Logically it would make sense that when the Nasdaq is plummeting, QQQ is the place to be rather than try to hit one stock. But I do not seem to get enough bang for the buck. What am I overlooking? Would I do better with the OEX? The QQQ is cheaper so I would rather put my money there, but something is wrong with the picture. Any ideas? (January 6, 2001)
You seem to advocate averaging into new positions of select stocks in this market. However, what guidelines do you use for setting stops? (January 8, 2001)
You write often about "averaging" stocks. What does it mean? (January 9, 2001)
I'm confused when you say "That is why we buy time on our short term option positions." It sounds like a contradiction to "buy time" on "short term" options. Could you please explain what you mean? I'd like to know what you consider short term and how much time do you recommend buying? (January 10, 2001)
Will Mr. Greenspan's 50 basis point hike prevent the "ship" from running into the "dock" as you explained most amusingly in your analogy several months ago? (January 11, 2001)
Are the indexes going to fall because options expire once again later this week? (January 16, 2001)
Tonight we combine the sections of Subscriber Questions and Team Trades because they cover a question on option volatility. (January 17, 2001)
I confess the bears are making me nervous. Red Herring twice noted the forecast of an unnamed technical analyst ("Mr. C") who sees a third leg of this bear market coming with the NASDAQ at 1900. I also read the comments of Mr. Steve Leuthold, president of The Leuthold Group in Minneapolis. He speaks of this same third downward bear market leg. He forecasts that "One year from now, the Dow will reach 8000 on its way back from a projected low of about 7000." Are we investing into a trap? What is this historical "third leg" of a bear market? I was looking at a 10 year chart of the Nasdaq and I don't see any such pattern in past corrections. (January 20, 2001)
After having my head handed to me over the last 9 months, I am trying to develop a daily routine whereby I examine various indicators, stock sectors, indices and volume to help me get a better handle on market sentiment. Do you have such a routine, and if so are you willing to share it? I am a real rookie at this game and need all the education I can get. I just seem to be wallowing in a sea of information that I don't know how to use or how much importance to attach to it. I have read each and every report that you have sent for the last several weeks and am impressed with your ability to analyze what's happening. You're far more accurate than your competition. (January 22, 2001)
Can you please address what it means for a stock to "fill a gap" and what the probability for this is? (January 23, 2001)
After your write-up on credit spreads, I asked my broker about them. He said that I should examine the risk/reward of the purchase and then to hold them until expiration. When you buy spreads, do you always hold them until expiration? (January 24, 2001)
Last night we talked of the IBD site that allows you to track volume for the current session as compared to the previous session. (January 25, 2001)
What is a "tombstone" doji and what do we do when we see one is a stock we hold? (January 25, 2001)
What is the relationship between volume and open interest [on options]? Is one more important than the other? What is the minimum number one should watch for, before placing an option trade. Should one exit the trade when the number drops below and remains below, the stated minimum number? (January 27, 2001)
In the January 29, 2001, edition of the "Daily" you present 19 different stocks for consideration for January 30. I am a subscriber to e-signal and wonder if you would shed some light on how to best keep watch on these stocks. Do you set alarms, and if so, are they at a price point or % changes? Do you create a new quotes screen each night for the following days' selected stocks? I find if I have more than four charts up at one time, it's too difficult to follow well. I would appreciate any tips as surely as I'm watching one, I'm missing another. (January 30, 2001)
With an interest rate cut January 31, 2001, and history saying this is a good time to be in stocks at least in the short term, what has happened a little further out? Spring/summer? What has happened in the past when first quarter earnings come out below reduced estimates? (January 31, 2001)
Can you please explain how to recognize when an index or a stock flashes a buy or sell signal. (February 1, 2001)
Can you please explain how one calculates an x% probability of a rate cut by 50 basis points by looking at the Fed Funds Futures? (February 3, 2001)
In your Investment House newsletter, specifically the option recommendations, you list out of the money option positions as a safer investment. I am still in the learning process, but I thought out of the money options are riskier since the underlying stock movement must be greater and you have very little intrinsic value. Also, your report does not recommend entry points on the options. I appreciate any information you could provide on this matter. (February 10, 2001)
Once a stock has broken out (e.g., through a critical level of resistance) and you have made some profit on the move, what guidelines do you use to sell and take your profit? It would be nice to be able to follow your advice on exit as well as entrance criteria. (February 12, 2001)
When I follow your suggestions and make a purchase (as in PLC & IFMX), & no follow-up mention is made from you, should I just sit & wait or what? (February 12, 2001)
I have a question about trading tech stocks in general. According to some on CNBC, the Nasdaq is undergoing a structural change in the sense that the days of high multiple stocks are over. I would really appreciate it if you have any thoughts on this issue and if you could share with us. (February 13, 2001)
It seems that a lot of options that I have looked at lately have had very low OI. I know that you say that you try to buy options with a Delta of around 75 and OI of 100 or more. An example is the Mar 65 PUT on NEWP. The Delta is -59 and the OI is only 90. Would you steer away from that as a general rule? (February 14, 2001)
In your newsletter [on February 14] you talked about short covering as you have in the past. Just what does SHORT COVERING mean? (February 15, 2001)
Is there a chance that you might discuss Brocade's (BRCD) earnings announcement on Wednesday, February 21, 2001? (February 20, 2001)
Seems you people are loosing faith in the market. Sounds like time to reinvest! (February 24, 2001)
Could you please include in your reports the historical price ratios you reference? You state the put/call ratio has not hit its high. Could you tell me what is the historical high? (February 26, 2001)
Have you considered using the VXN, the volatility index for the Nasdaq? (February 28, 2001)
When you talk about something moving on high volume, how can you tell relatively early in the day (say anytime before noon) whether volume is above or below average? All the tools I've seen will tell you average daily volume, but volume is not evenly spread throughout the day. So if a stock's average volume is five million shares a day and it has traded 1.5 million by 11:00, how do you know if it's on track to post an above-average or below average day? (March 3, 2001)
When you are playing QQQ. Which index are you watching? The Nasdaq Composite or the Nasdaq 100 which the stocks in QQQ represent? And are you also watching the intraday chart of QQQ? (March 3, 2001)
When you see a large trade on e-signal tick chart, how can you tell if it is on the sell or buy side? For example, SBUX had a 2,047,900 form T trade at 16:03 Friday for 47 9/16. The current ask was 47 3/4 and the bid was 47 9/16. Is there a way to tell if this was a sell trade? (March 5, 2001)
What does Jon mean when he states that Relative Strength has broken out ahead of price, which is a bullish sign? (March 6, 2001)
I'm a subscriber to The Daily and follow your plays right along with my portfolio. My question is this: how do you define the time frame for each of your plays? For example, if you've highlighted a stock which is looking to break out of its handle, but it doesn't today, do you continue to follow it without commenting on the stock in the next The Daily? (March 8, 2001)
We often receive questions regarding exit points on plays. There are many entry points on the stocks that we are covering, and that often makes it difficult to discuss stop losses and targets. But there are some simple rules of thumb that we follow, especially in times of turmoil such as the market is showing us. (March 10, 2001)
Could you please explain what you mean by buying the April $40 puts in DS? I would imagine if you expect it to go to 26-27 that you would buy the option closer to the expected strike price. I'm having difficulties understanding the strategy. Please explain. (March 12, 2001)
You state that we should put a stop loss in 7% - 8% under our initial purchase price. However on stocks that you are recommending lately like KLAC for instance, you state that the buy price is 46 3/8 on 10M shares and put a stop in at 45 7/8. This is much less than 7% - 8%. Why are you calling for such a tight stop? Is it the current market conditions or should we start putting in tighter stops on all new positions? (March 15, 2001)
In Thursday’s (March 15, 2001) newsletter, you suggest that if SEBL breaks support at 25 you would go for the April 35 puts. Why do you suggest going so deep in the money? Wouldn't the April 30s provide you with more liquidity? Wouldn't the April 25s afford the best leverage and profit potential? (March 17, 2001)
Is there any clean and easy way to short the DOW such as the QQQ affords with the NASDAQ? (March 19, 2001)
It would be very helpful if you could please list the index the stocks are in so we would know which index the stock probably follows, i.e., SCFS, Seacoast Financial Services, NASDAQ or NYSE? (March 19, 2001)
How do you start and finish a put play online? Do I place a sell at a stop limit? I am trying to set up a Stop Loss. I did a SELL ORDER and key in the stop loss target. However there are 3 choices: Limit, Stop and Stop Limit. Which one do I pick? (March 20, 2001)
Can you take us through a shorting of a stock? Any one would do such as your put selections. Also, how would you do this on line, or is it strictly by broker only? (March 21, 2001)
On several occasions in the last month or two, you have noted that the S&P500 is currently composed of approximately 20% tech stocks. Not long ago, the number reported in the media (papers and TV) was about 35% tech. Can you explain this further, as it does not appear that many stocks have rotated out of the S&P500. (March 22, 2001)
Another newsletter stated, "The CBOE put/call ratio for index options was at 1.83, which on a contrarian basis, is a bullish sign." This reading is higher than your .86 below, so was their higher number an intraday reading? Also, how do I find this ratio to follow during the day? (VIX was reported same by each of you). (March 23, 2001)
Over the weekend we discussed the put/call ratio. We failed to answer the second part of the question: how do I find this ratio to follow during the day? (March 26, 2001)
I have seen different average volume on different web sites for the same stock. For example INVESTORS.COM (Investors Business Daily) has an average volume different from Quicken.com for the same company. Can you explain why? (March 26, 2001)
I am looking at the formula used by "CBOE" in the calculation of Deltas. The formula includes a multiplication of "interest rate". Is the rate, the Bank's lending rate? What interest rate is used to calculate Deltas? (March 27, 2001)
Can you explain why SOX performance has such significant impact on the tech stocks overall? (March 29, 2001)
If we enter a prolonged period (6 to 9 months) of volatility switching daily from up to down momentum and back, what is the wisest trading strategy to pursue? Should we become position traders on a few select stocks? Should we focus only on day trading? What will work best? (March 31, 2001)
What price is Nasdaq going to be if QQQ hits 34-35, i.e., what is the conversion formula? (April 2, 2001)
What does the Arms Index tell us? (April 4, 2001)
In establishing a position whether it is a stock or call/put option, how much are you investing per trade (money-wise) in order to have a decent and worthwhile profit? (April 5, 2001)
Can you recommend a broker that allows Call/Put Option Trading in an IRA Rollover account? Ameritrade does not allow them. (April 7, 2001)
On Friday the VXN closed at a new high. If it were a stock or an index, one would believe that the VXN is heading higher. Can one in fact treat this chart pattern as if it were a stock or an index? (April 9, 2001)
A subscriber responded to the options in IRA accounts with the following information. We have no relationship with Fidelity, but we have sampled its online trading system and it is very good. So is the last statement this subscriber makes. (April 9, 2001)
How do you determine during the trading day whether volume is high or low, both in the markets as a whole and as to individual stocks? (April 23, 2001)
What time do institutional buy/sell programs kick in? (April 26, 2001)
I'm not sure if this is whom I should be writing to, but I have to ask. I'm a new subscriber and I started getting into the markets just after it peaked. What has caused this bear market of such dramatic proportions? What are the signs that it is rebounding? Should I be waiting for the tax cut that is still being promised? How should I set up my investment strategy? If these are things I should be asking a broker, let me know, but you guys seem to be the brightest of the bunch out there. Thank you. (April 28, 2001)
When you state specific volumes to watch for on breakout, or a buy point, is that a volume number for the time of breakout or buying, or is it on the entire day’s volume? (April 30, 2001)
I'm not clear about how or if to apply stop loss prices when you've written covered calls. (May 1, 2001)
When you give a buy target on the plays along with a volume target, is the volume supposed to be at that number when the stock reaches the buy price or is the volume for the stock just supposed to be on pace to reach that volume by the end of the session? When you put out the plays each evening, are those plays supposed to be good until the stock reaches the buy target, even if that's a couple of days away, or is the play meant to be good for the next day only? (May 3, 2001)
Reading your Team Trades summary tonight about DISH, I had to wonder if you ever place limit orders ahead of time and then subsequently make the buy trade in the pre-market trading hours, rather than waiting until the public open of the market? (May 5, 2001)
How does one calculate or estimate the "overhead supply" and/or "congestion" you often speak of in the newsletter? (May 5, 2001)
I'm a subscriber to the Daily. Could you tell me where you get the ticker symbols for puts and calls? (May 7, 2001)
[I]t is hard to determine what is in play, what might or was a play and what might be a potential trade. Is there any location on your site that sorts this out? (May 10, 2001)
Some stock experts recommend, to assure liquidity, that we not buy stocks trading below a daily average of 300,000 shares. But this recommendation seems meaningless to me, unless the number of shares one purchases is also specified. Is liquidity reasonably assured, for example, if you buy 20,000 shares, or only if you buy no more than 100 shares? It seems to me that some ratio would be more appropriate, but just what that ratio is, I would like to know. (May 14, 2001)
I subscribe to the Daily and I am only about 3 weeks old with your service. I am trying to find a site on the internet that provides the 10 and 50 day (and shorter term also) moving averages on any particular stock. Datek allows you to choose ave’s based on minutes (say 5 min ave), Etrade gives some info but cant see individual days etc. I’ve checked Yahoo and many others but cant seem to find this info. In the daily you mention watching where a stock is in relation to the 10 and 50 mvas, but I can’t find this info anywhere. (May 15, 2001)
I am a daily subscriber to your service and from time to time see you mention your following certain stocks on your Palm VII. I am thinking about purchasing one and was wondering if you could tell me if you are able to get real-time quotes and/or real-time streaming data on charts for the stocks you are watching. Also what brokerage service supplies this info to you. I have heard that Etrade is supposed to have some award winning service involving the Palm VII. Any information you can provide is appreciated. (May 16, 2001)
Is there anyway that you could put just one or two stock in the daily with entry point and target price without all the option terms. I am small investor, and don’t understand all the option terms. I only need 1 or 2 stock per week. Seems all the stocks you mention are for option traders. (May 19, 2001)
What do you mean by "aggressive" play? What do you look for in order to buy into the stock as an aggressive play and what are your rules for loss stops? (May 19, 2001)
I am confused, to put it mildly. I just read that Buckingham Reasearch has downgraded NVDA from a strong buy to accumulate. Why ???????????????? It has so much good stuff going for it. I don't understand this at all. (May 24, 2001)
My broker tells me he can't do a stop loss on an option. Do you have any information where I can find/research a broker that offers a stop loss on an option? (May 26, 2001)
When it comes to trading would your advice be different for someone trading with their money in a brokerage account subject to short term capital gains taxes versus someone trading within an IRA account? (May 26, 2001)
Some questions about how to take positions to the downside. (May 30, 2001)
Several questions about covered calls over the weekend and how we play them. (June 4, 2001)
Some previous leaders such as AMCC and JNPR seem to be basing. Should I sell these previous leaders and buy into NVDA? (June 6, 2001)
I have some burning questions for a long time, and wonder if you please could answer it for me. 1. When I hear: to go 'long', or 'short', is that used for options only, or can that be applied for stocks as well? 2. What time frame is considered to go 'short', or 'long'? 3. When one goes 'short' (if that word is applied for stocks), are all the shares sold, or only part of it? (June 7, 2001)
When a stock does break out on strong volume and makes a 10-15% run in 2 days it's normal for it to pull back some or even test the breakout point isn't it before it makes another move or consolidates? Also is it possible for a stock to sell off heavy below the breakout without any bad news on the stock or if the market looks healthy? I've heard a stock can pull back 20-25% after a run. Is this 20-25% based on the stock price or the difference from the breakout point and the amount the stock has gained? (June 11, 2001)
BRCD and FCEL, on Monday, June 11, ran hard off the bottoms on huge volume. What does that mean? I've seen it so many times before where a stock will just drift lower on tiny volume. Then, it'll slowly build up and explode on huge volume towards the end of the day only to drift back down the next day. Is there any play in these? (June 12, 2001)
If I buy the June call option on SCMR at 12.50 what will happen? If the stock reaches $12.50 or more before expiration, can I sell it? Or, do I have to wait for it to expire? How would this work? (June 14, 2001)
If a stock has met the buy point but has not yet hit the precise daily volume you want, should a buyer wait until the stock has met or exceeded that volume - perhaps waiting to purchase the stock on the day after the recommended daily volume has been met? Or do you suggest simply keeping tabs on the volume throughout the day as a percentage of the daily volume it is likely to achieve? Generally, is it ever wise to buy a stock when the buy point has been met but the volume has not yet entirely filled out? (June 14, 2001)
I've been trading for almost 10 years, and I had never heard of an 18 day moving average until I subscribed to your service. Is it a "trader's secret" or something? It just seems kind of odd when compared to the 10, 50, and 200. Do you have any information about it? (June 16, 2001)
What do you think the dangers are of a European economic slow down prolonging the US recovery of earnings for another year? (June 16, 2001)
Could you please tell me what " team trades " mean? Are you all trading at the same time? Do you send members emails to trade those? (June 16, 2001)
I don't know when a play is complete...for example, the other day, you mentioned a stock WM, telling the stop figure, the buy figure, and the target figure. The first and second day it did nicely, then it stated to fade. Do I stay, giving it a chance to hit target, and yet possibly having it go down further to the stop and losing money, rather than taking a small profit? In other words... when do I get out? (June 23, 2001)
If one buys a stock at $30.90 then it drops to $30.00, goes to $31.00, goes to $29.00, to $31.38, to $30.50, but does not advance much over the purchase price, or just stays a bit below it. For how long does one hang on to such a frustrating stock, after all the indicators said it was a good buy? 2 days, 2 weeks? (June 23, 2001)
My strategy in trading since 1997 was to buy LEAPS on stock in a strong uptrend and hold them until the stock closes below its 18 day moving average. I had great success doing this simple strategy. It was a strategy that was unemotional that told me when to get out. Since April of 2000 I have not found any stock that has been moving up in a strong uptrend. Those that seem to be breaking out and moving up seem to just fizzle out causing me to stop out. Since receiving your newsletter I have found a few potential candidates (EBAY, LOW, etc.). When you are buying the stock in your newsletter are you playing the stock on the breakout and selling as it peaks, then buying again at support etc.? Or are you holding these stocks longer term? Does the strategy I used from 1997-2000 still work and I just need to find the right stocks? Or do I need to become a shorter term play in these markets? (June 25, 2001)
If a stock makes a nice advance, but it is on less than average volume is that a bad sign that maybe the run is over? This is after a nice breakout and a pullback. Also if a stock breaks out on heavy volume and say does a pullback then resumes again making some gains then say breaks out on heavy volume again, how do you know when the base starts? I know it's not wise to buy into the 4th or 5th base breakouts. I understand the base suppose to last at least 7 weeks, but I don't understand when to determine when the base starts. (June 30, 2001)
ANSS...nice call...bought the stock today @ 16.32. Read your comment to buy @ 17.08 on 176,000 shares. Huge volume today in excess of 300,000. My question: you have a target of 20. Do you wait 'til 20 to sell? Or do you take partial profits here? I don't know how you guys handle a breakout. Does the stock more than likely have to retest the breakout level, which in this case is 16.95? Input would be much appreciated. Also, related question: many times you have the stock a buy "on the breakout" to a certain level BELOW your target. Does that mean you sell the stock at that level regardless, or is it just a level at which you no longer want to buy the stock because the risk/reward is not that good? (June 30, 2001)
I notice that when you recommend options to be bought on a stock you usually buy in the money options. Is there a reason for this? I haven't had a lot of luck with options, they usually didn't get up to my price and either ran out or I paid too much and time wore them down. Doesn't the same happen to in the money options? (July 2, 2001)
A recent comment you made really got my attention. You said, "We see lots of stocks starting to form up patterns that were not doing much until recently. Would you mind sharing with us what some of these stocks are and what improvement you see in their patterns? (July 3, 2001)
Could you please explain the significance of a pattern showing a doji on very high volume as opposed to the same doji pattern, but with light volume? How should the two differences in volume be interpreted on the same doji pattern? (July 14, 2001)
[Last night in the report we commented about when we would look at buying semiconductors in general, i.e., when their charts improved. This question followed today.] What would the charts show to reveal a true buy signal? Aren't most chip stocks slightly above the April lows? What do you look for? Are you expecting more downside? (July 17, 2001)
I've taken a position in LEN as you've recommended in the past. Today Yahoo Finance ran a story with the headline "Homebuilider Lennar files shelf for $700 million." What does that mean, and how might it affect my investment? (July 18, 2001)
You mentioned 'delta' the other day re buying a call. What's a delta? (July 19, 2001)
How do you decide what stocks on the reports to put your money into? (July 21, 2001)
If a stock is not acting right, . . .should you sell before it hits the Stop? Otherwise you can lose $4000 on each trade that goes south to the stop or below the stop. This market is so challenging right now, that you must try to minimize losses. (July 23, 2001)
As an investor in a company which announces a secondary stock offering, what should I do - sell or hold? Case in point - I hold 150 shares of TARO which announced a secondary stock offering at market close last night. The stock closed at 95, but today quickly dropped to the mid 80s. I know that when a secondary is offered it dilutes the share price of each share, but in the long run is this a negative for the company? TARO was my best performing stock until this happened, and I am unsure now if I should continue to hold or sell my shares. (July 26, 2001)
When you buy a leap, do you buy in the money or out of the money just after the stock splits?? It seems that just after the split the options come back down to normal? (July 30, 2001)
What is in today’s market the real definition of a 'long-term' investment? This is confusing, because 'long-term' can be stretched like a rubber band, as far as I can see. It means different time frames for different people. For instance, a stock is starting in a severe downtrend, does one ride it out, no matter how far it would drop, or does one also set a stop loss, get out, then re-enter when it starts back up? Does the sentence "never let profits evaporate" apply to 'long term' investments as well? (July 31, 2001)
What are the signs of accumulation and where (what site & how) can we see it? (August 1, 2001)
If a stock like OPMR has 91% institutional holding does it have much more room to go? How does that work? (August 6, 2001)
How do you figure the target sell points for stocks like EASI and others breaking out to new highs? Is there a percentage you use? From what point do you start figuring since they keep making new highs? (August 7, 2001)
In 1982, what spark lit the fire that took the S&P off it's lows? (August 11, 2001)
We have had a number of questions on stop losses in this market, so this seems like a good time to discuss them a bit. (August 13, 2001)
Where do you find the 50 day MVA on a particular stock in your portfolio? (August 14, 2001)
I don’t understand what this "buy up to 'price' " means. If I buy a stock at 19.60 and the target is 20.58, do I sell at 20.58? Is that a point at which you think it could [start a] re-test the breakout and go down? I know NOT to buy higher than 20.58, but do I hold it at that price? (August 20, 2001)
Found your column of August 18th most interesting. What indicators do you look at to conclude, "accumulation in the market started turning to churning and then to distribution"? (August 22, 2001)
[In Tuesday's Team Trades we discussed a trade on the QQQ] Were you trying to put on a spread or buying or selling puts? What does 5.60 by 5.80 mean? If the market makers moved bid to hit stops were these people selling puts? I always had to buy at the ask and sell at the bid. (August 22, 2001)
What volume(s) determine a block trade? Do they show up on realtime streamers such as Etrade or Scottrade, or do you need a subscription service to see them? (August 23, 2001)
What are the definitions of the analyst ratings? It is very difficult to understand the difference between Strong Buy, Buy, and Accumulate. They all mean that you should add to your portfolio. Yet when a rating is changed from Strong Buy to Accumulate, the stock will usually decline. Recently a firm put out a Sell rating on a stock. Then a couple of weeks later raised it to hold. Now how can you hold something that you do not own? If you had sold the stock on the initial recommendation, would not the proper new rating be accumulate? These recommendations are very confusing, but cause havoc on a stock's price. (August 25, 2001)
Where can you get a "real-time" value for the put/call ratio during the trade day? Also, where can you get end-of-day numbers for NASDAQ and S&P futures? (August 25, 2001)
What rationale do you use to decide on both the Expiration Month and the Strike Price for the options you list? (August 25, 2001)
In the last couple of issues you have pointed out stocks that you refer to as "topping". Can you please explain this and the criteria that you use to identify them? Should this be a signal to sell or not? (August 27, 2001)
Over the last week or so my girlfriend and I have made a ton of money based on your [plays] on the SOX and OEX. Thank you so much. It appears they pretty much move with the NASDAQ only with great price swings. Which leads me to believe (for the most part) that as long as we have a handle on the direction of the [Nasdaq] then we can play the indexes accordingly. My questions are these, since you don't always include the indexes in your reports, are there some rule of thumbs for playing them, i.e., resistance levels, open interest, etc.? (August 28, 2001)
[With respect to the ARMS index] the day count range that you wrote about [4 days to 20 days on a close above 1.5 and 1 to 7 days on back-to-back readings above 2.0], is that calendar days or market (trade) days? The NASDAQ Composite Index data and many NASDAQ companies did not exist for us to chart back to 1974. Should this be applied only to Dow Jones Industrial-30 stocks? (September 1, 2001)
The September 40 puts your Broadcom play are deep in the money. Why not buy something at the money, which looks cheaper--at least on the surface? (September 5, 2001)
How can I get an intraday quote of the VIX? (September 6, 2001)
After playing [the indexes] for the last few weeks with much success it is clear the SOX is the most volatile. My question is aside from the pricey options, are there any other negative factors to them? (September 8, 2001)
Where can I find the A/D ratio and the new highs and new lows each evening after the market close? (September 19, 2001)
Could you explain the trading curbs that I am now hearing about? Are they triggered electronically; are they for individual stocks or indices as a whole? (September 20, 2001)
I was wondering if I could get your input on JDSU in the very short term like in the next bounce. Took a pretty big hit again so looking for cheaper stocks for one or two plays until we can play the indexes again. It seems we lose maybe 1 out of 10 trades but the 1 loss always seems to hurt the most. (September 22, 2001)
When a doji signals a potential reversal on a daily chart, does the reversal have to occur the next day? (September 27, 2001)
I read stockcharts.com. In their daily chart they have the 50 day MVA as 15.91, in their weekly chart they have the 50 day MVA as 15.58, yet you say 16.16 is the 50 day MVA average that ABX just bounced off of. If your information is correct then mine is not. For obvious reasons I need to get this straightened out. According to my daily chart, ABX opened at the 18 MVA average and moved up from there all day. (September 29, 2001)
I see the phrases "....strong /great /huge /or outstanding money flow and buying... " used quite often in the stock synopses of the daily. I know that positive money flow and buying are good things. Are you using the buying indication to clarify that this is positive money flow, or is it something else? Also, is the Relative Strength often referred to, the RSI, or is it RS comparative (although I don't know what it would be compared with other than say an industry/group index)? (September 29, 2001)
You often refer to "up-trendlines" and "down-trendlines" on stock and index charts. How are they determined and is there any site on the Net where these can be plotted out? (October 1, 2001)
StockCharts.com looks useful but does not appear to be real time. Any references for real-time charting? (October 1, 2001)
How can businesses spend like crazy [referring to the passage of proper stimulus] when CEO's are still having major headaches dealing with massive overcapacity they have borrowed to invest in during the past ten boom years, when companies are announcing plans to shut down factories and plants, laying off workers quarter after quarter and writing off billions of bad investments? (October 6, 2001)
Very nice seminar last night. I'm learning a ton. Question: you've mentioned LUV as a stock suitable for long-term gains. How do we distinguish which stocks on the reports are suitable for long term gains, as opposed to short term returns? (October 6, 2001)
As a practical matter, can you explain how you use stops as you define them? Also, how stops vs. stop limits work best when they carry over to the next day? (October 8, 2001)
What are your thoughts on security/defense stocks at this time? For instance, VISG which has raced up about 500% since Sept. 11 (today it moved up 56%). If I get into it now, am I just chasing it and subject to a big fall? Or does this sector have staying power in today's environment, and makes a good short term play? On 9/10 VISG closed at 1.94 and today it closed at 13.10. On 9/10 INVN closed at 3.11 and today this stock closed at 14.73. Since these stocks have made their initial moves, I have been looking for a significant consolidation so that I would buy into, but thus far there has not been a significant downturn. I guess I could buy into at this level with a tight stop limit - but also feel they are overextended at this time, and I hate to invest in something where I feel that my stop limit will be executed. (October 9, 2001)
I really get a lot out of your perspectives and analysis of the market. I am in the market about 20 months now, and am becoming a fairly proficient chartist. I am interested in how you monitor intraday volume on the indices... all of them. (October 11, 2001)
Please explain why "worry is good for rallies". (October 11, 2001)
Would you tell me what's the symbol for Put/Call Ratio (CBOE)? (October 13, 2001)
Where can we find deltas on the web? (October 13, 2001)
You had mentioned the ARMS index a few weeks ago, as having a good track record for predicting market bottoms, then I haven't seen your conclusion of what actually happened. Could you comment? (October 16, 2001)
Why are the stocks that are connected with Anthrax Detection Systems consolidating now instead of forging higher? Specifically I mention both CPHD and NGEN. Early last week while most Nasdaq stocks were consolidating, these stocks were surging higher. Now that most Nasdaq stocks are strengthening, these stocks are consolidating. It would seem that with all the scare of Anthrax out there, that these companies would really be rallying higher. (October 17, 2001)
What are counter-cyclical stocks? (October 18, 2001)
I really don't want to go to my grave still searching for the real reason for the economy's trashing. Since "inflation" can be readily dismissed, would you mind sharing some of the "other motives" you have alluded to in past reports? (October 20, 2001)
Should investors put money back into NASDAQ consolidation now? It seems that we have missed the boat? (October 22, 2001)
When a stock breaks out on huge volume for a couple of days and only moves the price a little, what does that mean? (October 23, 2001)
I agree that the Nasdaq will need the S&P and Dow to clear resistance for any continued move to the upside. But consider this - Year to date the Nasdaq is down 28% while the S&P is down 17% and the Dow is only down 12%. So the Nasdaq has more ground to make up just to get back to ground zero. So could it be possible that we continue to see the Nasdaq out perform both the Dow and S&P until there is more equality in the indices? (October 27, 2001)
Would you please speak to the advantages/disadvantages of buying during the first 30 to 45 minutes of the open market trade and the last hour of the market? (October 29, 2001)
Could you please tell me which websites I can look for the volume of Nasdaq, volume of accumulation and distribution? (November 3, 2001)
Can you explain to me what a "point" is on an index? What monetary value does one point represent, or does it work that way? (November 3, 2001)
Why does the elimination of the 30 year bond free up money for consumers? (November 5, 2001)
It seems to me that with the market we have been experiencing over the last 18 months that there is an awful lot of overhead resistance. How is this market going to recover anytime soon with everyone, who has bitten the bullet on their stocks over the 18 month period, just sitting there waiting to pull the trigger and get out of those positions the minute they reach breakeven or less? Maybe a lot of these would be sellers have already taken their lumps and sold but that's just the way I see it. (November 6, 2001)
My question is, will the rate cuts have any positive reaction as long as the bank regulators keep money lending tight as they have been doing? Who controls the regulators and why have they not loosened up? (November 7, 2001)
[On the QQQ put option play] why [buy options] so deep in the money? There are only 578 open interests at today's close and they are expensive for average investors. I understand the time decay on owning an option works against me (vs. selling). What guidelines do you use in determining the strikes you are interested in? (November 8, 2001)
When I sell a covered call and the stock runs up in price, is there a certain point at which I'm better to close out the position early, rather than hold until the stock is called away at expiry? (November 10, 2001)
I was paying attention to the resistance marks in your [Thursday] reports so was aware of watching out (Thank You). But looking at market action [Thursday], I was seeing strong volume breakouts, up volume trouncing down volume, advancers beating decliners. All kinds of buy signals. So I was still somewhat surprised to see the big selloff on no news to speak of. Almost like there was program trading set to sell at certain markers. Kind of gives one the impression this market is rigged. Institutions buy big initially to run prices up and then sell it off. Still sounds like profit taking to me. Maybe it wasn't modest, low volume profit taking but still profit taking. (November 10, 2001)
How do you know when a stock or index will use the 10 day MVA or 18 day MVA? Especially in this strong run up? Do you play the 10 and see if it holds? Or do you go for the 18 day? (November 17, 2001)
How do you see "tax-loss selling" impacting the market over the coming weeks? Someone told me that the first 2 weeks in December the Mutual Funds dump a lot of their little companies and window dress for the last 2 weeks where they buy the GM's and other big companies to make their funds look good for their customers? They then sell a lot of the big companies and go into the little ones again in January? What about puts for the first 2 weeks in December and calls for the last 2 weeks? (November 19, 2001)
I have started using options more. I am buying deeper into the money than you usually suggest. That way my premium is much less. It also appears that the option moves more directly with the stock. Obviously my leverage is not as good. Any thoughts? When you use options, do you base your "Stop" on the cost of the option, or the cost of the stock? (November 20, 2001)
Mortgage rates have just increased substantially (0.65 %) on 2 years + terms (at least in Canada)!!! Why is that so when the Fed in the US and the Bank of Canada are reducing rates??? Is that just temporary or will the trend continue towards increases rather than decreases of mortgage rates? (November 24, 2001)
As a primary investor in mutual funds I am not sure how to interpret the following: 1. put/call ratio; 2. vix; 3. vxn; 4. support/resistance for exchange, i.e., Nasdaq support, resistance, channels, etc. Extremely interested in wanting to know how to understand your e-mail and use above data. (November 29, 2001)
Continuing our discussion of indicators, such as VIX and VXN, as well as what support and resistance are. (December 2, 2001)
Where on the web can one find information on futures both at night and in the morning before the market opens? (December 2, 2001)
I agree with your Q & A response on limit orders because I have also received poor treatment by the Floor Traders on market orders. However, last night (Dec 4) I put in all limit orders at or slightly above the previous closing prices on several stocks. Needless to say I did not execute any trades. All of my limit orders were below the lowest price of the day, so. I knew the market would gap up but I still don't like to use market orders. Is there anyway you can determine where those first trades are going to transact or should you just put in a market order so you don't miss the day like I did today? Or should I just get up at 6:30AM and watch the tape? (December 5, 2001)
At what point do you pull the plug as a rule of thumb on stock and/or options? [Is it] a point drop or percentage drop? Also, when you give a price target on a position is there a time frame attached to those targets? [For example] XYZ's target you proposed is 20.00, is that for today, the next trading session, long term? (December 8, 2001)
I was watching CNBC and heard several times that if/when it was announced Bin Laden was captured the market could probably expect a +/-500 point run on the news. Well, last night I heard several Military analyst's say they expect Bin Laden to be captured more than likely within a week. My question is, do you subscribe to the "victory rally" theory the financial analysts' are speaking of? If so what would be a good play for this? OEX ,SOX, QQQ? Furthermore, if indeed we did see this type of reaction from the market, how do you feel it would play out? 500 points over a span of one trading session, two or three days? (December 10, 2001)
I know that you guys watch the 200 SMA, but do you pay attention to the 200 EMA as well? It seems to me that many a move hits resistance or holds support at this level. (December 12, 2001)
When you place a buy price for a stock, do you place a buy limit so when it hits that price its executed or do you wait till it closes at that price? (December 12, 2001)
When you speak of volume . . . do you mean wait until the intraday volume has reached [the specified] level? Or, do you mean by looking at the current intraday volume you would think it would hit that number for the day? For example, the 50 DMA volume for IPIC is about 288,000, today's trade volume was about 433,000. I would think if I wait to see that it hits 362,000 it may be extended by that time. (December 13, 2001)
Why are ‘negative views by option players a positive for the market?’ (December 15, 2001)
Can you please explain what takes place in the last 45 minutes that unleashes all the buying activity so often? (December 18, 2001)
Under what conditions do you trade in the first hour? How long do you give the market before you jump in if you trade in the first hour? ...if market is opening up?...if opening down?... Do you respond differently depending on the direction of the market? (December 19, 2001)
Today I intended on buying EMLX as per your recommendation in last night’s commentary. I missed the boat due to being tied up in another position. Now, your buy point was 40.19 I believe. By the time I was able look at playing EMLX it was already at 41.70 but in the process of pulling back. Then the question occurred to me that maybe buying at the initial buy point after running up like that might not be such a good idea. So, my question is, your buy points: is that after breaking it for the first time, or is a run up over that level and then pullback to that level just as good? (December 27, 2001)
When you talk about buying aggressive point like on MCTR 8.40, is this at the 18 day MVA and is the next [buy point] at 9.57 a break above the 200 day SMA? Also you mention that you wait to buy usually after the first hour of trading; is this a good rule to follow, and do you ever buy pre-market? (December 29, 2001)
Could you tell me how I can use your advice to the best advantage since: I have a full time job and cannot do day trading. I usually review info in the morning before I go to work and can make trades then. Most of your advice however, is based on the stock getting to a certain price and with a certain volume. Is there a way I can place trades in advance based on that criteria? (January 2, 2002)
Wondering if you could shed some light on managing positions, especially during this time of market acceleration. I'm finding that I constantly am holding more positions than I can truly effectively manage. So many good stocks are breaking with good patterns that I find I want to take advantage of way too many of these... then I end up with two or three times the number of positions I can really keep my eye on. How do you keep this under control and manage a portfolio. I feel that holding 5 or 6 positions should be plenty and my intentions are fine, then I keep ending up with 15 positions! Any rules for behavior management? (January 5, 2002)
A question on stops and profits vs. losses: How do you deal with a stock that breaks out, then comes back to retest? My example is CBR. I bought it on the breakout (as per the Daily) at 9.20 on the breakout and it moved up to 10.95 three days later. The Daily target price was 11. Next day it dropped to about 10.25 with a low of about 10 and has been moving down to test the breakout point (today's range was 8.81 to 9.49, with a close on the high...looking like the test has been successful). [Editor: it since moved back up to 10.88 and closed today at 10.61] My question is, how did you play this stock? Did you buy at 9.20? Did you sell some or all at 10.5-10.75? Did you hold on and let it come back and test? Did you/will you add to your positions here at 9.5? Do you move your stops up as the stock moves up? (January 7, 2002)
Regarding stop losses, I have heard that they are visible to market makers and that they can manipulate stock prices to result in your stop loss being triggered and then the stock runs right back up. Are stop losses really good protection? (January 9, 2002)
I've heard mention of "Bellwether" stocks. How do you tell which stock is the bellwether for it's Sector/Industry? Are there technical criteria (like the highest average volume) or is it more of the ones that get the most press? Another publication just referred to AMAT as the Semiconductor Bellwether, but I hardly ever hear of it. Or, is there just a generally accepted list of Bellwethers for each sector/industry that more experienced traders know about? (January 15, 2002)
I'm wondering why, under the current conditions, you're not suggesting a short of the indexes (especially the QQQ's) or a short on AMAT or KLAC? It seems that they look like obvious candidates. Am I missing something? (January 16, 2002)
Hello. I really enjoy your newsletter. It has been very helpful. It appears from your writings that "ascending wedges" are good chart patterns to go long on once they breakout. I attended a class [and was taught] that in any wedge, draw the two lines that form the wedge and watch that the "flat line usually wins". In many ascending wedges, this is often the top line (the lows are rising faster than the highs), and the pattern eventually breaks down, not up. Do you agree with this, disagree? What are your thoughts on ascending wedges? (January 19, 2002)
When you have a support level in mind for a stock, is this set in stone on executing a sell if it hits intraday or only if it closes at or beneath that level? Case in point: SYMC [Wednesday]. Hoping for a hold of 74 but it did fall below before recovering. I did not sell when hit intraday but had in mind to, if it closed below. (January 26, 2002)
I was wondering if Jon L. Johnson and his team watch or listen to any financial stations throughout the day? If so, which are the better ones to listen to for reasonably unbiased information (if there is such a thing in financial reporting)? (January 28, 2002)
In your Jan 22 daily newsletter you indicate the possibility of a 50% retracement for all the indices. Yet at market close on the 22nd, the retracements were S&P 500 24%, the Dow/Jones Industrial Average 28%, NASDAQ composite 30% and the SOX a 40% retracement. Given these values doesn't it seem likely that each index will have its own retracement level? It seems unlikely that the SOX will wait for the S&P to catch up! What should an investor look for in the retracements that you believe that are coming? (January 29, 2002)
In your reports you will mention for some options whether there is low open interest or no open interest. How am I supposed to interpret this? (January 30, 2002)
Why is the following considered bearish: Head and shoulders patterns are stated as signs of a turndown in your newsletter, but that pattern looks like a base, a surge, and a then pullback. So what is so bad about that (as long as it doesn't break support)? (January 31, 2002)
My question is regarding short interest in a stock. KKD has a huge short interest (I think around 20%). How do you look at this with respect to a stock? It seems like it would be a contrarian indicator with that many shorts to cover. (February 2, 2002)
I would like to know when do you know what the breakout point is, and at what point do you buy. (February 4, 2002)
What is meant by "Double Bottom Recession Ahead"? (February 5, 2002)
You have written about 'even trades.' What are those? (February 6, 2002)
How many active positions at one time should I have? (February 7, 2002)
Everyone I know keeps saying that we will not go down to the September lows again (or lower). Why not? Seems almost a sure thing since no one believes it .........the perfect trap!!! (February 9, 2002)
Is extreme hi VIX bullish? Is a high put/call ratio bullish? I know they are but lately this got to be confusing when I read other commentaries. (February 11, 2002)
Can you please explain how you place trailing stop losses once a play moves into the money, both for stocks and for options? (February 12, 2002)
You mention candlestick charts quite frequently. Do they make up an integral part of your analysis? Where can I learn more about them? (February 13, 2002)
What is a normal course issuer bid, and how might it affect the price of a stock? (February 14, 2002)
When the market is positive and moving up, there have been any number of days when it opens with a fast upsurge or a gap open. Because of the strong open, there may be one or more (sometimes many) of the plays hit their buy targets in the first 5-30 minutes of the open. Of course, during that time it is often hard to gauge the market and certainly near impossible to tell if it is "opening enthusiasm'" or real buying power that is moving the stocks. What do you do in such cases? (February 16, 2002)
The VIX seems to be caught in a range between 22 and 30. Could you discuss the implications of it breaking this range either way? To the upside (i.e. above 30), do you anticipate that to be linked to a "major" sell-off, maybe lower than the September bottom? To the downside (i.e. below 22), would you see an important rally accompanying the break and where would you see the VIX heading for next "support"? (February 19, 2002)
What analysis did you perform to conclude the QQQ's target at 34? (February 21, 2002)
My question is concerning the relative strength of a stock. I have read that this is a good indicator for a stock, and that it should be 80 or above before you buy. Is this true? And what if the stock is below that, does that mean I shouldn't buy it? I would also like to know if there is a formula for coming up with that number. If so, is it possible for you to explain it to me. (February 25, 2002)
Sometimes you give trade with options that are in the same month expiration and in others you have an expiration two or three months out. I have heard you make more money if you buy in the same month expiration as the current month. (February 27, 2002)
Where do you get your information on the Put/Call Ratio (CBOE)? (March 2, 2002)
[There has been an increased] noise level very recently about US troops moving into Iraq and Turkey. I would really like to hear your take on market reactions if/when there is an escalation on the part of US. It seems imminent that this is the situation. I'd like to be better prepared to know how to prepare and respond for such an event! (March 2, 2002)
Could you not buy puts or go short for NVLS if you don't already have a position? (March 6, 2002)
Can you explain the term "DELTA"? (March 7, 2002)
Can you please tell me what web site I can go to that will tell me the volume & A/D line during the trading day on the NYSE and Nasdaq? (March 9, 2002)
When an analyst upgrades or downgrades a stock, does his big money clients get advance notice? (March 16, 2002)
When you buy puts on a stock that is breaking down, can you sell short as well, using the buy point for puts as the point to sell short? (March 18, 2002)
You write that companies will be entering their "quiet time." What exactly is "quiet time"? Is it required by law, and if so, for what purpose? (March 20, 2002)
Why not use the exponential 20 day MVA versus the exponential 18 day MVA? I hear a lot of services speak about the power of the 20 day MVA, but the first time I have encountered the 18 day MVA is on your site. I have no disagreement on the power of the 50 day simple moving average and the 200 day simple moving average. But, I am curious as to how you decided on the 18 exponential moving average versus others such as the more widely touted 20 day exponential MVA. (March 21, 2002)
Where can I find option deltas on the web? (March 25, 2002)
When you select stocks are you viewing Daily, Weekly or Monthly Charts? A few months back I set up my charting service with 1 day, 2 day, 7 day and monthly charts. I have been taking the charts from the report and viewing them in each of the above charts. I notice that it paints a different picture. For instance looking at NWK on a daily chart I do not see anything that makes me excited about this stock (Probably because of my inexperience). But looking at a 7 day chart of the same stock I see a beautiful pattern forming. Also when I view the different time periods the moving average changes. On the 7 day chart NWK has not closed below the 10 day moving average. As a matter of fact it has been following the 10 day MVA and now seems as though it has come to a point where it must either break above or below the weekly charts 10 day MVA. How do you know when to you use the different time frames, or does it vary with different stocks? (March 26, 2002)
You have been referring to the small and mid-cap indexes frequently lately. What are the ticker symbols for them? (March 27, 2002)
On your comments on SGI (The Daily, 4-1-02), you state it pulled back on higher volume to close with a doji. I thought we want to see the pull back on lighter volume? Is it the fact that it closed on a doji that the higher volume is good on this pull back? (April 2, 2002)
I would like to know if you still consider a stock a buy if you miss the buy point on a gap up but the stock pulls back to the point during the day. (April 6, 2002)
Would April 15 (tax day) have any effect on selling pressure from institutions this week? (April 8, 2002)
Can you explain what a mixed shelf is? For example, Raytheon announced a $3 billion mixed shelf. (April 9, 2002)
Last week you described seeing a buy program kick in. How do you know when a buy program is initiated? (April 10, 2002)
Why do you like to go so far out (month-wise) when you offer a stock that is optionable? (April 11, 2002)
How can we tell which stocks are for trades and which are for long term holds? (April 13, 2002)
How should your readers go about choosing the stocks to invest in from the newsletter? (April 15, 2002)
Many of your readers, myself included, do not yet do options, covered calls etc. When you say that a stock "looks to test the 50 day MVA at 'x' and that you will sell calls on the pullback and buy them back when the stock hits the 50 day MVA and bounces," are you telling those of us who do only stocks to sell them and buy them back when they hit the 50 day MVA, or to just sit through these growing pains and not sell, but to keep the stock, since you feel it might keep on going higher? (April 16, 2002)
Please explain more about the ECRI as a forecaster. Do we have access to these figures and their interpretation? (April 17, 2002)
When you list a stock in your newsletter, and a buy point, and it doesn't meet it in the first week, do you continue to watch it, and if it hits that buy point say a month later, then do you still buy it? (April 24, 2002)
You often mention trading channels and I know you use TC2000 for charting. Could you share your settings for these channels? (envelope channels in TC?) And, do you ever use Bollinger Bands? (May 6, 2002)
Can you explain the advantage of and what exactly is a covered call and how to do it? (May 11, 2002)
I have heard from others to always exit a pre-split play before the split date, to be out no later than the pay date--no matter what. Do you ever take this stance as well? (May 16, 2002)
Can you tell me how the exact pivot point is determined? (May 20, 2002)
Why would a stock that is below 11.00 split? RE: WTRS. (May 21, 2002)
I don't understand how to read the put/call ratio. I cannot get it through my head how to interpret this. A solution would be greatly appreciated. (May 28, 2002)
You mention money flow diving in one of your recent reports. What do you find to be the most accurate measure of this? I have seen so many with different values on the same day, I'm getting dizzy trying to come up with the best measure. (May 29, 2002)
I have enjoyed and profited from your service for several years and have a question. How important is it for a stock to reach the target volume or better on a BO play or even a play where you note the target volume? I've been following your alert service and note that up to 80% of the alerts do not reach the target volume even though they reach the BO point. I regularly calculate the % volume using the % of the day that has passed and that doesn't help much. Keep up the good work you are the only service I now use and find your analysis of the market and economic situation invaluable. (June 3, 2002)