SHREVEPORT, La., Oct. 22, 2004 (PRIMEZONE) -- Stock-Letter-Daily.Com (http://www.stock-letter-daily.com -- an affiliate site of StockPickReport, the web's only non-mainstream stock rating service), rates SPDR Trust, Applied Digital Solutions, Lexar Media Inc, Taiwan Semiconductor Mfg Co Ltd.
STOCKPICKREPORT RATINGS:
SPDR Trust (AMEX:SPY) -- SELL
http://www.stock-letter-daily.com/rating.asp?format=single&ticker=SPY
Applied Digital Solutions (NASDAQ:ADSX) -- WEAK BUY
http://www.stock-letter-daily.com/rating.asp?format=single&ticker=ADSX
Lexar Media Inc (NASDAQ:LEXR) -- WEAK SELL
http://www.stock-letter-daily.com/rating.asp?format=single&ticker=LEXR
aiwan Semiconductor Mfg Co Ltd (NYSE:TSM) -- BUY
http://www.stock-letter-daily.com/rating.asp?format=single&ticker=TSM
STOCK COMMENTARY:
Friday, October 22, 2004
StockPickReport Commentary
A Lot To Cover
We have so many great questions from members. I'll take tonight's commentary to answer some of them.
1. QUESTION: Please recommend a few good books on short term trading. ANSWER: We like the book "How to Get Started in Electronic Daytrading" (David S. Nassar). It is concise and easy to understand. For technical analysis, we like, "Technical Analysis Explained" (Martin Pring). And, we also think the book, "All About Options" (Thomas A. McCafferty) is a "must read" -- there are specific guidelines for trading that apply to all forms of trading, not just options.
2. QUESTION: I want more information on where to purchase gold and silver. ANSWER: We have personally bought silver from BullionDirect.com. On eBay, we've purchased silver from the user, "directcoin". With both BullionDirect.com, and "directcoin" on eBay, we've had very good luck with prompt shipping and high-quality silver. For gold, we have bought from IdealBullion.com. IdealBullion.com takes a pretty long time to fulfill orders, so we would use them as a "last resort".
3. QUESTION: Places like the "National Collector's Mint, Inc." advertise, at times, gold and silver coins that are duplicates of once original fame, such as "double eagles." I realize that these are not "originals," but are they worth the investment? ANSWER: Probably not. If you invest, we suggest you invest in the "real deal." If you cannot afford a high-dollar coin, buy the highest-quality coin you can afford. When in doubt, bullion silver and gold (in the form of "rounds," "art bars," or "American Eagles") is your best bet.
4. QUESTION: When they advertise "2004 $5 Gold American Eagles" for dealer cost of $46.50 per coin . . .is that a good investment? ANSWER: The standard measurement for gold and silver is the "troy ounce." Any coins you buy that are smaller than that weight will incur a premium, and any coins you buy larger than that amount will (usually) receive a slight discount. You will hardly ever pay less than the "spot" price of the underlying bullion, in any case. If you buy a $5 gold coin (1/10) ounce, the "bullion" value will be 1/10 the "spot price" of gold. Today, that amount is $423 an ounce. So, a 1/10 ounce coin would be $42.30 plus a premium. You can usually find the 1/10-ounce coins with a 10 - 15% mark up. So, $46.50 is probably a fair price given current market conditions.
5. QUESTION: Are your sell suggestions based on as much info as your buy suggestions? ANSWER: We use the same criteria for our "sell" suggestions as the "buy" suggestions.
6. QUESTION: Isn't a swing trader the same as a short term trader, and how do you pick your swing trade stocks, rsi, macd stoch? ANSWER: We view "swing trading" and "short term" trading as the same thing. (Please see the answer to question #8 for more on "swing trading".) We use very standard RSI, Stochastic, and MACD readings to find our stocks. After we find a group of stocks with good technicals (RSI, Stochastics, and MACD), we "eyeball" the charts to find stocks with clear levels of support that make logical stop/loss points. There are other considerations but these are the main points.
7. QUESTION: What settings do you use for your technical analysis? ANSWER: MACD - 5,34,5; Stochastics - 15,4,4; RSI - 15,4
8. QUESTION: Is swing trader also a momentum trader? ANSWER: Swing-trading and momentum trading do describe a similar style. The names both suggest that a trader "get into" a stock while it is "swinging" up from a low point in a channel, or that the "momentum" of the stock price is heading up from, again, oversold areas.
9. QUESTION: I'm new at stock trading, and my husband and I have a little money that we have set aside for this purpose. This is money that we can afford to lose, but obviously do not want to as we are hoping to continue to build our savings through the stock market. You have made me very concerned about the S & P closing below 1100. If that happens, do you believe that the stock market will take a down turn for a long period of time, like many months? A year or more? And, if the S & P does close below 1100 does that mean that we won't be able to find stocks that will go up quickly like Winn Dixie did? ANSWER: We believe the S&P 500 is in a 17-year bull market. Yes, that includes the down turn since 2000. We do not believe (at this time) that if the S&P closes below 1100 that there is, necessarily, a protracted downturn ahead. However, since StockPickReport tries to find stocks with short-term entry positions (or exit positions) we feel it is important to watch the S&P to find a good time to get in or out of a stock for the SHORT term. Regarding your last question, we believe that there are always opportunities. You just need to carefully pick your stocks and use stop/losses to conserve capital if you're wrong -- which all traders will be from time-to-time.
10. QUESTION: When you recommended TWR yesterday I went to a popular Internet charting service and from what meager insights that I have gained it seemed that: Stochastics looked about as bad as they could get. RSI was laying on the floor panting and the ten period momentum oscillator indicated that the issue is so oversold that one would need a gun to get a buyer interested. From my perspective there was just no possibility of it moving up significantly today. OK, I am a dilettante at this so what am I missing and can you give me some direction toward the proper interpretation of technical indicators? ANSWER: Since we don't know what service you looked at, we cannot comment on what you saw that was so negative regarding TWR. On a daily basis, Stochastics, RSI, and MACD look about as good as you can expect - all are turning higher from very "oversold" conditions. Your point about being "too oversold" (if I get your meaning) is fair. However, we believe it is always better to buy when everyone else sells, and vice-versa. That said, please note that when RSI, MACD, and Stochastics were all as "overbought" as they are "oversold" now, TWR was at around $4.00. Now, if you were a buyer, you'd certainly have done well to wait til the technicals were "in your favor", as they seem to be now when TWR is at $1.22.
If you did not get a question answered here, please email don@strikefriday.com.
Look for your new stock picks this weekend for Monday morning! For More Commentary Go Here: http://www.stock-letter-daily.com/index.htm
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StockPickReport.Com ranks stocks with technical analysis. These ratings do not indicate a "long term" view. These ratings reflect an opinion for the short term. These ratings may change based on market conditions.
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If the links to our ratings above do not work, please use these:
SPDR Trust (AMEX:SPY) -- SELL http://www.stockpickreport.com/rating.php?sym=SPY Applied Digital Solutions (NASDAQ:ADSX) -- WEAK BUY http://www.stockpickreport.com/rating.php?sym=ADSX Lexar Media Inc (NASDAQ:LEXR) -- WEAK SELL http://www.stockpickreport.com/rating.php?sym=LEXR Taiwan Semiconductor Mfg Co Ltd (NYSE:TSM) -- BUY http://www.stockpickreport.com/rating.php?sym=TSM