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Guy,
Remember, I use CandleVolume charts so our channels are slightly
different. I have Dell in three progressively steeper Interim Up Trend
Channels dating back to Jan 96 with the last one from July 96 through Oct/Nov
96, late Dec 96, and March 97 lows. It broke out of that channel on the up
side on 05/02/97 so I drew a new Raff Regression Short Term Up Trend Channel
(STUTC) starting on the March 97 low and ending yesterday, then extended it to
the right. This channel is the steepest of all and Dell is about mid channel
as of yesterdays close. I have the top of the STUTC at 100 and the bottom at
85 1/2. RSquared is at 0.93 and rising indicating a strong trend, S/C is 83
and rising, and QStick is .78 and rising. All indications of a strong up
trend still in progress. For what it's worth (probably not much <G>), if it
was me, I'd sit tight and set 100 as my target for selling or selling covered
calls, and 84 3/4 as my stop.
Jim
-----Original Message-----
From: Guy Gordon
Sent: Tuesday, May 13, 1997 12:15 AM
To: Jim Greening
Cc: MetaStock-List@xxxxxxxxxxxxx
Subject: What to do about DELL
Jim (or anyone else on MetaStock-List) please give me your opinion
about which channel DELL is in:
I draw a long-term channel with the support line running from the July
96 low through the lows of March and April 97. The resistance line
runs trough the highs of 9/20/96 and 12/10/96.
A shorter-term channel can be drawn with a support line through 1/2/96
and 3/19/96, and a resistance line through 12/10/96, 1/23/96, and the
top of just about every trading day for the last week. This short
channel is parallel to the 50-day moving average for the last two
months.
Question: Which channel will DELL follow? If it is the short-term
channel, then I should sell (or sell covered calls). If it is
following the long-term channel, then I should hold.
My opinion is that DELL will follow the short-term channel. Reasons:
1. That one is parallel to the 50-day MA.
2. For the last week DELL has been hugging the short-term resistance
line, and has been unable to break through. This line has strength.
3. With a PE of 34 it will be hard to grow at the steeper rate of the
long-term channel.
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