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Or here: http://www.investorshub.com/boards/board.asp?board_id=3424

Home of the magic box.. http://www.investorshub.com/boards/board.asp?board_id=1616

gm, any magic boxes currently

thanks! pug

it all depends, pug. it depends on many factors. for one, what is the timeframe that you desire to hold the stock? if this is a stock that you hope to hold for a long time, you may set the stop loss at a riskier price. interestingly, some would do the exact opposite. almost more importantly, how volatile is the stock? let's say that a stock at price of $10 sees an average daily trading range of a dollar. all things being equal, when the stock is $10, it will trade between $9.50 and $10.50. if you set your stop loss at 5%, it will very likely be triggered before it rises to, if it rises to, $10.50 before it falls back to $10. in this example, had you set a stop loss at above 5%, you would not have lost the 5% and you would have had a zero gain/loss day. another consideration is how afraid you are of losing your money. if this is a pure speculation play with some fun money, perhaps you're more willing to set a risky stop loss. if it's money for investing and you're trying to safeguard it, setting a stop loss that would yield a minimal loss would be wise. heck, some brokerages don't even allow stop losses for certain penny stocks and otcb/pink sheet stocks.

opinions on stop losses vary greatly. trailing stop losses are another option. if the stock increases to $12 from $10, do you now set a stop loss based on the current price of $12, or do you safeguard your original investment? if you set a new stop loss or a trailing stop loss, you might be stopped out of a bigger gain, because stocks often go through a retracement (a price correction) after a gain but before an even bigger gain.

so many things to consider, pug. some of the standard stop losses are 3%, 6%, 7%, and 10%. it all depends on the stock and your level of comfort.

update what do you usually use as your sell-stop in regards to the percentile used - say you buy at $10, where does the sell-stop execute..$9.50, $9.00, $8.00?

5%, 10%, 20%

the magic box guidelines are just that: guidelines. while one who looks for them must not become too lenient for what defines a magic box for a specific stock, one must also not become too rigid. you will miss out on possible huge gainers if you are greatly bound by the rules.

here is a great example of a floating magic box. i told you about lenf/aid. it was the stock that released some news midday. everything happened at once on the 11th of july. the day before there was a down day. the next started as an up day. so there are the two candle components for the overall candle setup. by the time that that happened, the williams was already confirming. on the 11th you also got the aroon crossing. everything happened so quickly, with the williams confirming 3 market days earlier. if one had said, "well, the williams already confirmed. i don't want to jump in becuase of that," he or she would have missed out on a one day jump of about 70%.



i like that you're noticing the fine points of the magic box, pug. that is great. i would rather see someone stick to the components of the magic box as if they are set in stone than if someone used them way too leniently. on the other hand, if you're getting confirmation independent of time, use your own discretion.

without the inclusion of the charts, here is my exact post right before the huge move for lenf (now aid) started:

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LENF Charts - Mid-BB Magic Box Confirmation

LENF was just approved for listing on the AMEX, which will start 7/15. Aroon Down crossing Aroon Up just below 70. Williams confirmation. Nearing a Magic Box confirmation in weekly chart, too? To be honest, I think that LENF is a wonderful opportunity for substantial gains. Unless the charts tell me otherwise, I would not settle for anything less than 50%.

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i made no mention that the williams already confirmed, but i did note that it was confirming. perhaps i blurred the magic box confirmation guideline, but, again, remember... a "guideline" is just a guide. it's not a policy.

good question, pug. questions are always good. they help you define your focus.

from reading the instructions though, the williams shouldn't move to above -50 before the arron goes to 75 right?

"i was looking for prior magic box setups last night, and found that many times it works - sometimes the williams sets to above -50 during day 1 or 2 - stay away from this right? also wstl is more eye appealing than neng for some reason?"

pug, it must not be the case that the williams goes to and above -50 at the very time that the aroon does x or the candle setup does y. the williams can move independently. the best case scenario is that the aroon and the williams move in sync with the candle setup, but it is not necessary. sometimes the confirmations are delayed. you can get a williams confirmation days after the candle setup off of the lower bollinger band happens.

i certainly agree that wstl is more eye appealing than neng. both look good, but wstl has everything going for it. when you see other indicators agreeing, it is a good thing. perhaps today, pug, i will talk about some of the other indicators.

i'm really happy to hear that you're still researching. do you see how dmoi, while not having the ideal candle setup for a magic box, has the aroon and williams confirming? again, the dollar volume isn't substantial, so the aroon and williams don't mean all that much.

no posts here lately, eh?

well, if you're still researching and interested, i do recommend looking at my history of posts. look for the ones that have the ticker symbol in capital letters. usually my topic headings for my picks and watches will be something like "xxxx charts." i try to do a good and thorough job of explaining why i think something and what i think the stock will do. please note the date of the message and the guidance that i give, especially when i offer implicit "go ahead" statements or when i offer explicit "watch only" statements. i do not always post the price of the stock at the time of post, but i try to do it regularly. please feel free to go all the way back to when i first started watching for magic boxes, which is about mid-june.

i'm not saying that i'm especially able at finding good stocks. what you can deduce from my messages, though, are the rationales that i offer. you can pick my brain by reading my already existing stock guidances and charts. nonetheless, i do think that i do a good job finding winners. not all of them are, but you can see when i win and when i lose.

i have no specific timeframe for stocks in general. it all depends on what i think the stock will do and where i'd want to set my exit points. of course, my exit points may change as the stock increases. if the stock drops, my stop-loss would catch it.

exit points have everything to do with overall investor psychology. you'll see many, many stocks bump their heads against moving averages. either a stock may hit a moving average and retrace, or it may temporarily stall at the moving average only then to take a big jump above it. another possible exit point can be defined by looking at support and resistance prices. look at the chart below for realnetwork. i'd explain what i just said regarding supports and resistances, but i think the chart speaks for itself. you should see tons of patterns below.

now, i may exit early if the stock is not doing anything. it depends on my timeframe. i'm willing to stick it out for rnwk because the stock is still on target for a possible run to above $7. again, it all depends on what i've already decided for myself when i take a position. there are other factors, too, for investors. reasons for squaring a position are numerous. maybe an investor needs cash to buy a dishwasher, and the best available place to withdraw some cash is from the market. though, if you need to sell some stock to get the cash to buy a dishwashwer, perhaps you shouldn't be investing in stocks.

by the way, i've been in love with rnwk ever since i saw this chart about two months ago.

gm, might I ask the average time period you are in a stock before exiting while using the magic box? or is the spread so substantial from stock to stock, that the mean is not relevant?

captain crunch, hahahahahahahahahaha!!!

"On a different note, I thought I was on my way to finding my own version of a "magic box" last night, but the charts broke down at about 12:30AM. LOL"

i'm running out of vital posts, but that one deserves its own response. very funny, captain. thanks for the laugh! hahahahahaha!!! seriously, man, that was funny.

anyway...

i'm happy to hear that you're taking some interest in, uhh, this type of magic box, too. lol. i hope that you've been able to run through our back-and-forth and understand it. feel free to ask your own questions. i'm more than pleased to help anyone who wants to understand. i've given this caveat to pug, so i'll give it to you: i'm not trying to sell anyone this method. there's nothing for me to gain from it, except to see someone else learn and possibly use it for financial gain. i do not recommend using this method for financial gain unless and until you become somewhat proficient. it's not exactly a talent (then again, maybe it is), but the method does need honing.

best of good fortune to you, captain crunch.

well, the magic box is that "single vehicle." you want indicators that represent different aspects of a stock's movement. as i stated before, if you have several indicators that more or less represent the same thing, their importance is diluted when they appear to confirm together.

all that a magic box is is a group of indicators that work well together. if you go onto other stock boards, you will likely find other systems that work well and many other systems that don't. i don't know about those. what i do know is that the magic box works and works very well.

as far as an indicator being a result of a psychological event, all price movement is a result of a psychological event. when you place an order to buy or sell shares, the order is placed due to a psychological event: the one between your ears. what technical analysis does is synthesize all of those personal psychologial events from the other investors into one digestible graphical and algebraic representation of the psychological event as a whole. now, you can go through the websites that define what the aroon, williams, candles, and other indicators are. it is far easier for you to learn what they mean that way than for me to tell you what they mean or represent.

this is only the second day of my telling you about the magic box. there's plenty more time for you to study -- if you choose. go at your own pace. i went very fast at the beginning because i was thrilled by it... and i saw immediate substantial results. i can show you some of the first charts that i posted. they were good ones that yielded solid returns, for the most part. there are a couple other key indicators i want to tell you about, though. in due time.

update i like what i have read about the magicbox, but can you tell me what it is accomplishing specifically - for example when this indicator goes this low it is BECAUSE (of what psychological events).....and then this indicator goes here BECAUSE (of what psychological events)....can you show how all 3 indicators perform as a single vehicle

pug, here is the response...

"update here's the million dollar question - why the magic box? what makes this TA technique different and better from the others"

i've not made any comment about the magic box technique being better than any other specific technique. what i did say, though, is that many other chartists try to find validation when there shouldn't be. that's partially why technical analysis has a bad reputation in some analysts' eyes. have you ever listened to a record backward? so often you swear you hear something that you think makes sense, but it's really just gobbledy-gook as always. that's what many chartists are trying to do. their playing the chart backwards, trying to find something intelligible when there is really nothing there. the magic box is not that gobbledy-gook. in time you will find out that it's a sound, practical, and practicable system.

all i know is that using the magic box method works. trust me. you can discount if you want, pug. as i said before, i'm not trying to sell you anything. if decide that this is bunk, so be it. i think you'd be making a mistaking by discounting the magic box method, but that is your prerogative, of course.

if you were wondering why it's called the "magic box," the naming of it is just to give it a snappy title. it's a way to remember it and to give it some panache, if you will. that's all. there's no real box. i'd say that there's some magic in it, but that's just my opinion.

sorry, but i just need a place to put these charts so that i can get the scripts for them after i change computers. this place seems innocuous and unused.

Amazing...simply amazing

hope the layoff doesn't slow him down

hope the layoff doesn't slow him down

What a way to end the week! Not only did Ken Jennings win his 38th consecutive game, but he set another record: highest one-day total. On the Friday, July 23rd show, Ken won an unprecedented $75,000, bringing his jackpot to a whopping $1,321,660.


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?JEOPARDY!?CHAMPION ENDS
TWENTIETH SEASON ON A RECORD HIGH
Ken Jennings? One-Day Total of $75,000
Smashes Previous Mark


(CULVER CITY, CA) July 24, 2004 ? On Friday, July 23, long-running champion Ken Jennings of Salt Lake City finished the regular season of JEOPARDY! (and his 38th consecutive show) by setting a new one-day record. Jennings won a whopping $75,000, eclipsing the previous high mark set by Brian Weikle of Minneapolis, Minnesota, who earned $52,000 on April 14, 2003.
Friday?s win brings Jennings? total earnings to $1,321,660 and makes him the highest cumulative winner in JEOPARDY! history. Brad Rutter of Lancaster, Pennsylvania previously held the title after winning the Million Dollar Masters Tournament and a total of $1,155,102.

By all accounts, Ken now holds every JEOPARDY! record for winnings? and he?ll be back to try for more. From July 26 ? September 3, JEOPARDY! will present encore shows of some of the highlights from the past year, notably the College Championship from Yale University, the Teen Tournament and Power Players and Kids Week from Washington, D.C. Then, on Monday, September 6, Ken Jennings returns to defend his championship in his 39th appearance, kicking off the 21st season of JEOPARDY!

Jennings, who has developed a celebrity-like following since his June 2 debut, juggles his current job developing software for CHG Companies, Inc., with multiple media requests. He has been featured on the front page of USA Today, presented the ?Top Ten List? on Late Show with David Letterman, shared the couch with Jay Leno on The Tonight Show and was named ?Person of the Week? by ABC World News Tonight. However, easy-going Jennings says he is just as comfortable staying at home with his wife Mindy and playing with their year-and-a-half-old son Dylan and dog Banjo.

A JEOPARDY! rule change introduced at the beginning of Season 20 allows contestants to continue playing as long as they keep winning. Previously, champions had been limited to five wins.

JEOPARDY!, a winner of 24 Emmy awards since its debut in 1984, was recently listed among ?The Greatest Game Shows of All Time? by TV Guide, and continues to be a ratings champion. The series is the #1-rated quiz show in syndication, and has held that title for over 1,000 weeks.

JEOPARDY! is produced by Sony Pictures Television, a Sony Pictures Entertainment Company, and is distributed domestically by King World Productions, Inc. The U.S. episodes are distributed internationally by CBS Broadcast International (CBI). King World International Productions, a subsidiary of CBI, sells and produces format versions worldwide.