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Re: hedge_fun post# 21592

Tuesday, 02/28/2012 6:36:38 PM

Tuesday, February 28, 2012 6:36:38 PM

Post# of 31572
Consider this...

One thing I learned the hard way...TA is worth less than a share of VSPC on penny stocks. Accum/Distrib. takes into account where the security closes, relative to the day's range. Since a last minute sale in a penny stock (or purchase) can move the close by such a large percentage of the possible average daily range, the A/D can be massively under/overestimated.

That kind of volatility usually doesn't occur in regular equities.

I looked at it in a much more simple fashion. We had a Supply-Demand scenario (before Dr. S decided to accumulate with a vigor), and a scenario after that point. Supply hasn't changed; they're still selling stock on a quarterly basis. But, there is a material increase in demand from his buying.

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