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To: arete; rohry; Billy_bob_bob; Willie Green; montag813; steveegg
What really separates the men from the boys is interpreting the invisible tracks that dodge like pixies about your computer screen. These are the material factors that are not plotted on a chart. When tape reading or reviewing a chart, you can't see them there like: price, volume, money stream, tick volume, on balance volume, RSI, MACD, stochastic, etc. But they are there, making themselves felt just as surely as trendlines and moving averages. They interact with what you see, and they modify the significance of what you see.

What are these invisible gnomes, slinking craftily behind and between the trends and reversals that steal our gaze as we strain for answers? They are the long shadows of the news, the persistent pushes and pulls of the market and sectors of the market, the authoritative demands of underlying fundamentals. They are the ghosts of public mood and management fakery and fickle institutions and naïve investors and bungling media who never get it completely right. They swim in a flow of valid information and malarkey, wisdom and foolish tips, leaks and unfounded gossip - all dressed in the same garb, all claiming to be in the know.

The consummate technical analyst sees these invisible marks on a chart peeking out from the green price bars, and he uses them to rearrange his thoughts.

The experienced chart reader modifies every event with something hidden. He asks himself questions like: "Was this advance on good news, bad news, or no news - and which do I think would be best for the stock?" "Does this reporter know what he is talking about, or is he just filling in a reason to make a story?" "Can I expect the CEO of this company to give us an unbiased accounting of why he wants to merge?" "Why is this stock going sidewise despite what I read in the news?" "What is the conventional wisdom about this industry, and why do I suspect it is too pat and too easy?" "Why I am surprised by what I see on this chart?" "Why did the other two auto stocks go down today?" "I know this company issued an earnings warning today, but why has it already gone down so much?" "Why did the news program report that this stock was up ten points today without mentioning that it was down twenty points yesterday?" "After reading what they're saying about this stock, would I be able to guess, approximately, what the chart actually looks like?" "Is there hidden opportunity here?" "Is there hidden danger here?" "Am I ignoring the obvious?"

Buying stocks really doesn't take much brains at all and any reason under the sun is good enough not to buy a stock. Once one holds a security however, all that changes. Every second that one holds onto that stock requires an active decision not to sell. That's when brains really come into the picture. The results of selling after buying are indicative of how intelligent the stock trader is.

13 posted on 12/10/2002 8:31:53 PM PST by raygun
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To: raygun
The consummate technical analyst sees these invisible marks on a chart peeking out from the green price bars, and he uses them to rearrange his thoughts.

I never thought much of technical analysis
and tend to dismiss it similar to Miss Cleo's numerology.
I'm more inclined to invest based on a specific company's fundamentals.

19 posted on 12/10/2002 9:56:03 PM PST by Willie Green
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To: raygun
Go back to writing poetry. :o)
21 posted on 12/10/2002 10:24:22 PM PST by billybudd
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To: raygun
The results of selling after buying are indicative of how intelligent the stock trader is.

Or how connected he is. (See Martha Stewart, Hillary Clinton, et al)

25 posted on 12/11/2002 5:02:58 AM PST by Huck
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To: raygun
It might have been poorly-received, but you pretty much nailed it. However, I must take issue with the "Buying stocks really doesn't take much brains at all" line. Knowing the difference between a bargain and something that's in a terminal dive does take the same skill at interpreting external factors as knowing when a stock is about to plunge off a cliff.
26 posted on 12/11/2002 5:15:36 AM PST by steveegg
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