Forum Archive Index - January 2002

["Chris Morgan" <actionsports.napier@xtra.co.nz>]

Phaedrus

The charts & graphs that you have displayed that vividly backs up your
opinion, are those charts available from a site or are they from your own
charting package.

Morgy


----- Original Message -----
From: Phaedrus <Phaedrus@techemail.com>
To: <Sharechat@sharechat.co.nz>
Sent: Wednesday, January 30, 2002 8:03 PM
Subject: [sharechat] Lion selection group


> I don't want to rain on your parade, but thought it would be good to
present a rather different opinion re LSG, by way of balance, perhaps.
> I know nothing of the fundamentals of this stock, but would not, however,
consider buying it for the following reasons :-
> (1) It has recently broken through its trendline, giving a Sell signal.
> (2) There is strong resistance at 85 cents.
> (3) There is a large Buy/Sell imbalance (143,434 bid, 586,730 offered)
This means that over four times as many shares are for sale as are sought.
> (4) Buyers are weak - the top Buyer at 81 only wants 1134 shares.
> (5) There is very heavy selling pressure at 85 (327,649) This will
reinforce the resistance already existing at that point, and will make this
level even harder to penetrate.
> 6) This stock is very lightly traded - only 15 trades all day, average
trade about 5,500. It is all but impossible to make a serious investment in
a stock like this without pushing the price right up. It is equally hard to
exit without depressing the price substantially. Slippage is therefore very
high.
> (7) Larger holders of this stock are getting out, and small holders are
getting in. This typically happens toward the end of a trend as
professionals sell to amateurs. (Average buyer 7000, average seller 17,000.)
> (8) If I was interested in this stock, I would have bought and sold at the
trendline breaks, making well over 30% in 10 weeks. Many traders will have
done just that - you will be buying from them. The big difference is that
you will be running a lot more risk than they did, with less chance of
reward, to my mind.
>
>              Phaedrus. (Back from holiday, tanned and fit!)
>
> _____________________________________________________________
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