J Clinton Hill

19 'Bathwater Babies' for the Week

Dan, I usually don't reply but as I sense your frustration, I will try my best. (I have much more patience with the market than I do with people.)

Determination of oversold stocks is based upon a proprietary algorithm that is non-related to stochastics or relative strength although these indicators overlap sometimes.

As a money manager and ex-hedge fund manager, I'm may be looking at the same market but thru a different prism. I don't know what your investment process is, so I can't say. Oversold stocks can remain oversold for quite a while as markets can behave irrationally a helluva lot longer than most can remain solvent.


The objective of this screen is not to recommend a buy, sell, or hold on a specific stock, but to identify names with potentially sound fundamentals that are being oversold based upon institutional buying & selling pressure patterns.

Now it's up to you or other readers to do your homework and determine if the fundamental reasons you own or want to buy these stocks remain intact. Personally, I use this list to stalk stocks and watch them for hints of fresh institutional rotation/support. This requires some patience, but it can be rewarding. Besides, it's much easier to hunt and learn the habits of a smaller group than follow a large universe. Think of yourself as an assassin waiting to pull the trigger when the odds are more in your favor. When you get that final capitulation, chance favors you the most.

If you don't own this stock and it has fallen another 10%, you should be as happy as a pig in shit. On the other hand, if you do own it, then it's a risk management issue and only you can determine what's acceptable for a loss.

Now let's be realistic. The stock has made a 57% run from Oct-23-2008 thru Jan-06-2009. During the same period, the SP-500 eked out only a 2.93% return. This is a relatively strong stock and I suspect there are good fundamental reasons for its superior performance, but it is undergoing a price correction. Trees don't grow to the sky, unless you believe in "Jack and the Beanstalk". Incidentally, the company is in the right space/sector too, i.e. healthcare info technology. If you read the details on the last employment report, the healtcare sector is the only group that continues to increase new jobs in our economy while all the others contracted.

Hey man, I'm just trying to help people focus on potential opportunities and I don't even get paid for this shit, i.e. blogging. I do give specific investment advice, but only when people pay for it as a premium service at my website.

Good luck with your investing and trading. If you are looking for the Holy Grail, you will find it within yourself and nowhere else. Believe it or not, it (the Holy Grail) actually does exist. Trust me on this one....

Sincerely,

J Clinton Hill

On Jan 11 12:26 PM Dan Jacome wrote:

> How do you determine if its oversold - what is the process??