TIME LINES & REASONS

[Wolfman]

Thank you for your comment folks.

I have panicked and sold a stock that has been falling only to have it bounce immediately and keep climbing, leaving me out in the cold.

Phaedrus, your article gives a strategy to cope with that and the safety of knowing in the event of a real collapse, protection is there. Cheers.

[Wolfman]

Thanks Duncan.

I see how you project a profit line forward and compare the stocks progress with it and also the progress with other stocks.

I think I need to try and work both bits (forward projection and trends) into my practice analysis and see how it all fits together.

[whiteheron]

Phaedrus

I have read the article referred to in your post of 12 Jan above

What you say in your article and what has happened to me are so closely related that it is uncanny !

I always enjoy reading the postings you instigate and your comments and explanations on postings by others

Looking foward to some more robust discussions in 2005

[patsy]

Phaedrus - Thank you for the link to your article in Sharechat.

Just a quick question: How do you determine accurately a support level? Do you work it out by analysing visually a chart or is there a formula or a more sophisticated way of doing it?

Thanks in advance.

[Phaedrus]

Patsy,
First off, I don't think you should try to determine support levels "accurately". They are best thought of as "zones", in my opinion. Having said that, it is surprising just how often they can be accurate, right to the cent. (These are the ideal examples that I post!!!)
You should be able to see support on a chart from the other side of the room. As with a trend, if you can't see it easily, if it is not obvious, it's not there.
"Is there a formula or a more sophisticated way of doing it." I'm sure there must be. Sometimes the simplest methods are the best, though. In any case, I have not been able to program MetaStock to recognise such things, so I am unable to mechanically backtest any system that uses trendlines, support or resistance.