PO Box 9491
San Diego, CA 92169
When To Take
Selling high accumulation stocks as
well as any others
by William Schmidt, Ph.D. - Tiger Software -
San Diego, CA
When should we sell?
Such an automatic signal tells us when to sell out because the ice
underneath the market is too thin. The Peerless Stock
Market Timing Software's famous killer "S9"s, are discussed elsewhere in
Click to see chart of Apple's top in July 1990 at the time of
our PEERLESS Major Sell Based on DJI.
. Click to see chart of Digital Equipment's top in July 1990 at the
time of our PEERLESS Major Sell Based on DJI.
(2) We have learned use Tiger's Power-Stock-Ranker Software to watch for price head and shoulders patterns with our Accumulation Index dipping into negative territory while the right shoulder is being made. You can see an example of this just above in the case of DEC. By way of illustration, look at CUBE and CARN.
Lesser known Carrington Labs is proof that small companies often reverse and decline
dramatically after completing a quick head and shoulders top. Profits are won by the ever
Serious deterioration of the TIGER Accumulation Index is very common among stocks that form major tops. Its appearance with a vast majority of high tech stocks in April and May 1996 warned of the coming 20% NASDAQ decline in June-July 1996.
(3) We sell our favorite high-tech high accumulation stocks when they start making new highs which are unconfirmed the On-Balance-Volume Line (OBV) not making new highs. Two recent examples, SOLV and ZOLT, show the dangers of not heeding the warnings of "false new highs".
(4) We sell our high accumulation stocks when they explode unreasonable - doubling or tripling in a week or two and then have a day when they close lower on the highest volume in a year. This is the simple formula for our major "S24" sell signal. Two recent examples are: ANCR and NYER. Both ANCR and NYER were originally bought a year earlier near 6. They were first picked up by our TIGER ELITE STOCK PROFESSIONAL (ESP) Service because they showed massive Big-Money accumulation. Their rallies were ignited by the "TIGER Terrific Triad" - a nested B10, B12 and B20.
(5) We advise selling our high accumulation stocks when they make new high after a big advance of 100% or more, but their TIGER Accumulation Index is in negative territory. Such blatant non-confirmations of a new high signify heavy Big-Money Distribution. An example of this is FSCX which we recommended on our Elite Stock Professional Service below 8.
(6) When one our stocks zooms up extraordinarily, as CAMP did, we nearly always take profits when the stock closes below its 50-day moving average. This is a commonly used point to place a STOP SELL order, so we have to be quick. Fortunately, most of the high accumulation stocks we buy give other warnings when to sell. That is the purpose behind our proprietary major S25, S26 and S27 sell signals. The Sell "S20" tells us that the stock has closed below its 50-day moving average.