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<DIV><FONT size=2>All,</FONT></DIV>
<DIV><FONT size=2> This was a scary week in the
market. Everything I had was down except MDM. I don't know why MDM
moved up, but I hope it keeps it up <G>. Anyway, I was stopped out
of GMH and SKYW Friday. Then I decided to pull the plug on all my Internet
and computer related positions and closed AOL, ATHM, and MSFT about an hour
before the close Friday. That left me about 70% cash with long positions
in C, FNM, MDM, and SCH. In retrospect, I may have panicked a little by
closing those positions. The NASD OTC index is still well within a Short
Term Up Trend Channel (STUTC) as were AOL, ATHM, and MSFT. My system says
that as long as the index that most closely resembles the stocks (in this case
the NASD OTC index) is in a STUTC the stocks should be held until they hit a
target or a stop. However, I don't feel too bad about closing those
positions early because I didn't want to see my large profits of the last few
months evaporate and I did have early warning that the market may be
correcting.</FONT></DIV>
<DIV><FONT size=2> The early warning began when,
as discussed a couple of weeks ago, the Dow Jones Industrial Average (DJI) broke
out of its STUTC on 1/21/99. It had previously bounced off the top of its
wide Intermediate Term Up Trend Channel (ITUTC) in early January and moved down
a little and mostly sideways since then. After the 1/21/99 breakout, it
paralleled the bottom of the channel up moving back in and back out of the old
channel a couple of times. However, it has now been below the bottom of
the old STUTC for the last four days. Also, the Binary wave has been
dropping for three weeks and is about to turn negative. The QStick, while
still well positive, has been dropping fro two weeks from an extremely high
positive position. That doesn't look good to me. To add to my
concern, the NYSE composite Index has copied the DJI pattern and the Russel 2000
Index broke through the bottom of its STUTC Thursday.</FONT></DIV>
<DIV><FONT size=2> However, its not all doom and gloom
<G>. On the positive side the NASD, OEX, and SPX are still well
within their STUTCs. Also, I have been using a standard deviation of 1 for
the bottom of the channels to set my stops. That gives early warning of a
trend reversal at the cost of more false signals. Remember a deviation of
1, by definition, will contain 67% of the moves whereas a deviation of 2 (which
I use for the targets) will contain 95% of the moves. So it's entirely
possible that the breakouts will be false breakouts that would be contained if
the deviation was set at 2. </FONT></DIV>
<DIV><FONT size=2> Anyway, I did close the positions
<G>. As penance, and due the uncertainty, I'm going to sit and watch
for at least a couple of weeks and let my brain clear before entering any new
positions. Therefore, there won't be any weekly pick this week. I'll
send a DJI.GIF chart to everyone on my email list. If you aren't on the
list, and want on, just yell.</FONT></DIV>
<DIV><FONT size=2></FONT> </DIV>
<DIV><FONT size=2>JimG </FONT></DIV></BODY></HTML>
</x-html>From ???@??? Sun Feb 07 20:26:03 1999
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Date: Sat, 06 Feb 1999 17:10:10 -0500
From: Marcia <Marcia@xxxxxxxxx>
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Subject: Re: breakpoint pricing
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Alton Stephens wrote:
> Folks, what is "breakpoint" pricing as respects mutual funds?
>
It has to do with the amount of "front load" or commission some mutual
funds charge. If you invest say $5,000 a fund may charge you 5%. If
you invest $25,000 you will hit their first 'breakpoint' and only be
charged, say 4%. Breakpoints usually occur at $25,000, $50,000,
$100,000 and $1,000,000. The commission drops at each 'breakpoint'.
Each fund family has their own structure and rates, so ask.
Marcia
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