Success is a State of Mind - - Tommy Bahama Profits always take care of themselves but losses never do. The speculator has to insure himself against considerable losses by taking their first small loss. - - Jesse Livermore The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the man of inferior emotional balance, nor for the get-rich-quick adventurer. They will die poor. - - Jesse Livermore
Success is a State of Mind - - Tommy Bahama Profits always take care of themselves but losses never do. The speculator has to insure himself against considerable losses by taking their first small loss. - - Jesse Livermore The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the man of inferior emotional balance, nor for the get-rich-quick adventurer. They will die poor. - - Jesse Livermore
with these big swings in the market lately,,,,,,charts are going to start showing railroad tracks......does anyone have an IBD article on railroad tracks for readers on here. i didnt find one so couldnt post one. but its a good pattern to watch for on charts that have made runs
I thought so therefore, posted two articles on it.
Success is a State of Mind - - Tommy Bahama Profits always take care of themselves but losses never do. The speculator has to insure himself against considerable losses by taking their first small loss. - - Jesse Livermore The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the man of inferior emotional balance, nor for the get-rich-quick adventurer. They will die poor. - - Jesse Livermore
Article Title: "‘Railroad Tracks' On Weekly Chart Signals Top Is Near " Author: NANCY GONDO Section: Investor's Corner Date: 2/4/2005 Your stock has been rallying nicely the past few months, or even years, without pausing too long to take a breather. Should you lock in your profit or let it ride?
Watching the stock's chart can help. If the stock runs up quickly for two to three weeks (10 to 15 days on a daily chart), with a few big upside gaps, tread carefully. It may be heading for a climax top.
The price spread between the stock's weekly low to high will get bigger than any other week since the start of the run. Another red flag that can occur near the top of a climax run: "railroad tracks," a term coined by IBD founder and chairman William O'Neil.
In this pattern, the stock rises sharply higher one week, then retraces the prior week's wide price spread, before closing slightly higher or lower on usually brisk volume.
The price bars and hash marks showing the weekly closes look like two sets of parallel lines on a weekly chart - giving railroad tracks their name. This indicates heavy selling by mutual funds and other big investors combined with minimal upside price progress for the week.
For more discussion and charts of railroad tracks, go to Pages 107-108 of the latest edition of O'Neil's "How To Make Money In Stocks." The recently published "How To Make Money Selling Stocks Short" has more examples.
Applied Materials broke out of a long, deep base in early January 1999. The big chip gear maker chugged mostly higher from there, running up sharply in the second half of the year through early 2000.
You started seeing big upside gaps in price during that rally, like a 16% jump the week ended Jan. 14, 2000 and 13% the week ended Feb. 11, signs a climax top might be near.
The stock rose 11% the week of March and edged higher the next week. The week ended March 17, it retraced most of the prior week's price spread, even undercutting the low. It closed a fraction of a point lower than the March 10 week to form railroad tracks 3.
Volume surged higher than usual, indicating heavy selling by institutions. This was the right time to take some profits, then look for further sell signals. Applied soon topped in a climax run. In mid-April, it crashed through its 50-day average on its biggest trade since the market turned in October '99, a big clue to sell the rest of your shares.
Article Title: "Railroad Tracks On Stock's Chart Show Rally Losing Steam " Author: JONAH KERI Section: Investor's Corner Date: 3/5/2004 The sight of a train rolling down railroad tracks can conjure up all sorts of thoughts and emotions.
It can bring to mind adventure, as passengers traverse the country. It can evoke commerce, as the train carries its cargo to its next destination.
If you see railroad tracks on a stock chart, though, that should trigger another thought: It's time to sell.
A railroad-track pattern typically occurs near the top of a climax run. In such cases, a stock retraces the prior week's wide price spread, from the prior week's low to its high. It then closes the week up a bit, on heavy volume.
The pattern is called railroad tracks because on a weekly chart you'll see two parallel vertical lines. The hash marks denoting the weekly closes are not far from each other.
That kind of action indicates selling by big-money investors, with lofty volume accompanying minimal price progress for the week.
"When you see a stock just not making any progress, with those big spreads, that late into a run, that's another cue" to consider selling, said Mike Doran, chief strategist at Shingle Springs, Calif.-based Sierra Capital Planning.
IBD founder and Chairman William O'Neil's book, "How To Make Money In Stocks" (3rd edition), cites two examples of railroad tracks.
Analog and digital chipmaker Analog Devices formed a railroad-track pattern over a two-week span in late February and early March of 2000. Sure enough, the stock soon rolled over, in step with the falling Nasdaq. Though it tried to hold its ground for a few months, by October it had sliced through its 200-day moving average, burrowing lower.
Human Genome Sciences traced a similar pattern in late February of that year. The gene researcher turned drug developer plunged 79% in eight weeks after topping in early March 2003.
Charles Schwab also etched railroad tracks a few weeks before it staged a violent blow-off top in 1999. After rising in the week ended March 19, 1999, the discount brokerage fell hard the next week, intraweek. The stock swung nearly 15 points that week (pre-split), before closing up just 3.7%.
Meanwhile volume came in heavy, at nearly 12 million shares. Putting those two weeks together formed a railroad-track pattern.
That pattern came following a long, steady run-up. The week of April 9, Schwab zoomed higher and faster than it had before, up 34% in massive trade.
The next week, it staged a nasty reversal off its top, again in gigantic trade.
Schwab went on to plunge 88% from its April 1999 top to its March 2003 bottom. Though it's recovered somewhat, the stock remains miles off its all-time peak.
Success is a State of Mind - - Tommy Bahama Profits always take care of themselves but losses never do. The speculator has to insure himself against considerable losses by taking their first small loss. - - Jesse Livermore The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the man of inferior emotional balance, nor for the get-rich-quick adventurer. They will die poor. - - Jesse Livermore
I enjoyed watching Lemieux play more than Gretzky. I watched the game where he scored 5 goals against the Rangers in 1998 or something like that. It was a great game. I loved watching him play. He was my favorite.
I was lucky enough a couple of years ago to play in a pickup game with some NHLers, two of which were Joe Thornton and Sergei Samsonov. This was before the Bruins decided that it was a good idea to trade away their best players. Anyway, Joe Thorton, that guy was scary. I think it's hard for the average fan to grasp how skilled these guys are. There wasn't anybody on the ice that didn't play either college or pro hockey and Thornton and Samsonov made mincemeat out of us all. And it wasn't even a challenge for them. I knocked Samsonov off the puck once. That was my claim to fame, even though it'd been by accident. Samsonov was like Barry Sanders out there. Thornton I couldn't even look at without crying. But I remember thinking that if these guys are this good, how good must people like Lemieux and Jagr be? It boggles the mind.
By Matthew Goldstein Wall Street Editor 12/19/2006 10:20 PM EST Click here for more stories by Matthew Goldstein
Morgan Stanley (MS - news - Cramer's Take - Rating) is in hot water with regulators for using the Sept.11 terror attack as an excuse for not producing documents in customer arbitrations.
The NASD is suing the big Wall Street firm claiming it falsely told investors and their lawyers that critical emails were lost in the terror attacks that destroyed the World Trade Center complex, where Morgan Stanley had maintained a big operation.
Regulators allege the claim was a false because the firm was able recover most of those emails within days of the attack.
The NASD decided to sue Morgan Stanley after it was unable to reach a settlement with the firm.
The NASD claims that Morgan Stanley failed to provide pre-September 11 emails to investors and regulators in numerous proceedings from October 2001 through March 2005. Regulators "also charged that Morgan Stanley falsely claimed in many of those proceedings that such email had been destroyed.''
Four years ago, TheStreet.com first reported that Morgan Stanley was hiding behind the 9/11 terror attacks., citing the destruction of broker commission records stored on computers at 5 World Trade Center as a defense in a number of customer arbitration proceedings.
In fact, in one arbitration case that was pending back in 2002, a Morgan Stanley executive filed an affidavit saying it was technically possible for the firm to recover some of the lost commission records, but that doing so would be difficult and time-consuming. In the affidavit, a copy of which was obtained by TheStreet.com, the brokerage contends it "has no business need to retrieve this data," other than to assist its adversaries in litigation.
"It is essential that firms comply with discovery obligations in arbitration proceedings and respond fully and truthfully to regulatory requests," said James S. Shorris, the NASD's head of enforcement. "In this case, we charge that Morgan Stanley's conduct fell far below those standards, with the firm repeatedly making false statements about the existence of important evidence, and failing to provide that evidence in numerous proceedings.
This is not the first time that Morgan Stanley has run into trouble with regulators over allegations it failed to produce requested emails.
Earlier this year, the SEC ordered Morgan Stanley pay a $15 million fine to settle allegations that the investment firm had repeatedly failed to turn internal emails requested by regulators. In that matter, the SEC charged Morgan Stanley failed to produce "tens of thousands of emails'' that were repeatedly demanded by regulators over a five-year period, beginning in 2000. The SEC said the firm's actions "compromised'' the two investigations.
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