Yahoo! Gary B. Smith Chat Transcript

Gary B. Smith chatted on Yahoo! Jan. 19 at 5 p.m. EST.

TSCEllen

: Hello everybody and welcome to today's chat with Gary B. Smith! Gary will be answering all your market related questions in about 20 minutes -- so stay tuned! Find out what Gary thinks about the @Home/Excite deal. Send in those questions for Gary B. Smith and make sure to check out his "Technician's take column" in TheStreet.com. If you'd like more info about TSC chat events, please send an email to chats@thestreet.com.

gsmith4

: I am ready. Bring it on!!

TSCEllen

: Hello Gary and thanks for chatting with us tonight!

gsmith4

: Great to be here!

TSCEllen

: Let's start with a question many of our chatters have:

_CSC_

asks: Hey Gary, What is technical analysis

gsmith4

: Could mean a lot of diff things. But, in my def. it's the use of charts to figure out a stocks' future action.

zeetrade

asks: Hi, Gary. HAve you had tiem to work with Ed Hubbard's spreadsheet? What do you think?

gsmith4

: HOnestly, I've not used it. I have enough difficulty with my own!

Arvindicator

asks: Hi Gary; AMZN corrected to its 13 day moving average, volume is drying up, yes/ no?

gsmith4

: Well, I'm not big on the MA stuff. But, it does look like AMZN is pulling back nicely.

fergusondd

asks: Gary. I love your column. I know this isn't your gameplan, but what stocks would you buy if you had to hold them for the next 6 to 12 months?

gsmith4

: Wow. Great question. Normally, I'd say stuff like AOL, etc. But now, well, maybe the oil drillers.

Arvindicator

asks: YHOO, corrected to short term support but volume and candlesticks are questionable, yes/no?

gsmith4

: I think so. Moving more down, than sideways, though. I'd be leery of it.

boots123

asks: Gary, how should be go about analyzing internet stocks?

gsmith4

: Whew! I think you can use standard TA, but you really have to have wide money mgmt parameters.

Casey1982

asks: Do you know Nick Carter, Gary?

gsmith4

: Wide receiver for the Jets, right?

Arvindicator

asks: Does the market need to rest?

gsmith4

: YES! Will it? I hope so!

TSCEllen

: Gary, what do think about today's Excite/@Home deal?

gsmith4

: I don't know yet. Could be very good for athm. For xcit? Uncertain.

Arvindicator

asks: Gary what do you make of the "tape" today

gsmith4

: I think it was more negative than the final numbers reveal. I think the market is a bit sour in general.

Arvindicator

asks: aol; is it consolidating after running up

gsmith4

: Yeah, I think so. But, I'm still not certain it can go a whole lot higher.

gsmith4

: Apparently, we're having technical problems. Therefore, my overall thoughts on the market: One, I think we're either going to rest for awhile or go down. I tend to think the latter as I have exactly ONE long right now! Two: I think there is still a bunch of froth in the internet arena. But, I sure wouldn't short that stuff.

zeetrade

asks: Oil drillers, Gary? Didn't know you were such a contrarian!

gsmith4

: Right. I'm usually not. But, I think just about everything else is (or was recently) way overbought.

StockMktWatcher

asks: What's the best Tech. Analysis software available?

gsmith4

: If you're talking one prod that does it all, that's probably TRadeStation. But, I like Worden's TC/2000. Unfortunatley, their latest release is a bit buggy.

boots123

asks: How can we take advantage of the rest in the market Gary?

gsmith4

: I would try to buy near where the stock broke out previously. If you're bold, stuff like AOL doesn't look bad.

Range_2u

asks: about y2k can you just eliminate the line of code that says experation date

gsmith4

: Well, I'm guessing someone already thought about that, and concluded that just wouldn't fix it.

JaNe_LaNe_1999

asks: Why did you choose to go into the quote unquote "buisness" that you are in?

gsmith4

: If you mean the writing/trading business the prime reason was mobility and lifestyle. Money was secondary, although I certainly like that aspect.

zeetrade

asks: Gary, do you put any credence in the oscillator? gsmith4: Zero.

edwineb_98

asks: gary, how does ek look as short? ChatYahoo_Lisa: If you'd like to ask a question and don't see the question box please type /ask then ask your question

gsmith4

: I think it looked better the day after it gapped down. NOw, it's too late for my methodology.

Icover

asks: Gary, your thoughts on last weeks possible trible top on heavy volume. Is this a possible "bull trap"

gsmith4

: I hadn't looked at the market in terms of a triple top. But...I do think it's due to go down some. Reason: I have almsot nothing on the long side.

StockMktWatcher

asks: How do the money center banks look to you right now, Gary?

gsmith4

: Better today. I wish they looked great last week!!

ben1004

asks: do you have any kids gary

gsmith4

: Abosolutely: two girls, 11 and 9

Arvindicator

asks: GTary do you have any open short positions

gsmith4

: I have one that I did today: mchp. So far, so good.

edwineb_98

asks: gary, you use candlesticks--yes. so what particular candles to pay attention to (hangmans, hammers ?)

gsmith4

: Oh, I"m more of homegrown candlestick man. Couldn't even tell you all the names. The one I do fear is the one that is all dark with the dark part, starting at the top.

boots123

asks: Gary, your thoughts on analyzing online investments sites, MKTW, INDI, etc?

gsmith4

: If you're talking as a trade, they don't have enough data for me to analyzie

StockMktWatcher

asks: What do you think is the best indicator to use for entry/exits into stocks (MACD)?

gsmith4

: Well, I always use the same: a break from congestion on heavy volume

badco1_98

asks: where do you call home?

gsmith4

: For the next 30 minutes, connecticut. Then I'll be in Maryland. Moving tonight!!

Rhyddy

asks: Gary, what about the steels now that they've dipped a bit?

gsmith4

: groups, I've never traded!!

Icover

asks: I agree that the new version of TC2000 is very buggy. Do you know if they are going to fix or forget it?

gsmith4

: I think they'll probably fix it. I know I'l lbug them about it!

jtd23455

asks: How do you feel about the CLEC's, like any?

gsmith4

: Ha!! My wife is an exec with ICIX. So...I'll pass on that one.

badco1_98

asks: Gary whats your thoughts on Mutual funds?

gsmith4

: Good for many who don't have the time to do their own homework. In fact, wish I was in Janus 20 last year.

zeetrade

asks: Gary, How's the GBS classic holding up so far this year. Up? What %?

gsmith4

: KRAPPY!! Not up -- down!

edwineb_98

asks: gary, in your column you review dell as a rising wedge w/ poor volume thus bearish. my take on dell is that it looks more like an inverted complex head and shoulders which is bullish.

gsmith4

: Well, that's why there's chocolate and vanilla!

rcspott

asks: got any great book suggestionson TA for beginners

gsmith4

: Sure: see my book col back in December in TSC.

Icover

asks: Gary, your articles have been honest and well written. I have made money by using and refining your ideas. The key I feel is discipline and patience, your thoughts?

gsmith4

: Thank you. totally agree. In fact, see my col tomorrow. I sure hope you/I are right!!

fergusondd

asks: What do you think about AOL from here?

gsmith4

: I think it's pricey, but at least resting. A good buy for some. Not for me though unless it has more congetion.

StockMktWatcher

asks: If you could suggest one stock, which one?

gsmith4

: Boy, is that one wide open. Okay, here goes: one stock for the rest of my life......probably AOL

Zombob

asks: Hi Gary. Love your columns. Any thoughts on CMB chart?

gsmith4

: Had a good day today, right? I think it could go back up.

jmcbsb

asks: Do you chat much online?

gsmith4

: Well, I'm not hanging out on the chat boards if that's what you mean. More of a lurker!!

jtd23455

asks: How do you feel about CMGI?

gsmith4

: Yikes. Pricey. Plus I"m sick of reading about Jim Dines (the original internet bug -- ha! Ha!) having recommended it!

zeetrade

asks: If you could short just one stock?

gsmith4

: Well, I shorted mchp today, but that's probably not what you meant. If you mean for the rest of my life I guess I'd short something like ebay. Still don't get that stock!!

sidmyboy

asks: Hi Gary, the last time I asked you about LMT your pique came thru loud and strong. I've been short since 53 (post split), doubled up when it broke the TL (Neckline). I'm looking for $30. Your thoughts?

gsmith4

: I haven't looked at it lately. But, shorts are wokring a lot better lately!!

jtd23455

asks: Do you follow any thing in the Internet Gaming sector?

gsmith4

: Dont' kow that sector, sorry!

StockMktWatcher

asks: What do you make of the claim that tech. analysis is like witchcraft?

gsmith4

: Well, let's put it this way: there's a TV show on now about witches...but none about fundamentalists!!

rcspott

asks: Gary, how long have you been heavy into trading

gsmith4

: I've traded for about 10 years in one form or another.

rcspott

asks: Also, how many stocks do you try to deep up on..

gsmith4

: All really. I scan all 10K stocks every night.

Roger_Moore70

asks: Don't you think this market is turning into a pyramid scheme?

gsmith4

: Actually, yes.

zeetrade

asks: I agree Gary, EBAY is a loser.

gsmith4

: YOu and me zeetrade. We might be the only ones!!

rwiederhold

asks: Gary, What do you think about the Y2K ?

gsmith4

: Overrated. Will be a one, maybe two day event.

edwineb_98

asks: gary, are you net long or net short these days?

gsmith4

: I am net short but only by a fraction.

Icover

asks: Gary, your thoughts on if we are in an accumulation, mark up, distribution or mark down phase?

gsmith4

: We're in sideways market with negative overtones. I do NOT Like the feel of this market.

balloonsacs

asks: You mention that you take all trades. Can you give us some feel for the number and amount invested per trade on any given day?

gsmith4

: I make about 2 or 3 trades per day. As far as amount, let's just say lot size is 1000+

rowmpaterson

asks: Thoughts on Citigroup?

gsmith4

: LOved them a few weeks ago. Not now, though.

GullibleFool

asks: What do you think: MSFT a good short at the open tomorrow?

gsmith4

: Only if it gaps up about 30 points!!

zeetrade

asks: Just wait, Gary. Will willl be vindicated on EBAY. You call THAT a business model?

gsmith4

: Zee: but...at least they're making money!

pacchiarotti

asks: Hi Gary, I like your articles!! I am a tech novice, do you know some tech help to pick up stocks in bottom fishing ?

gsmith4

: I wrote about that in a col last year. See my colum on getting AMTD at a LOW!!!

rcspott

asks: Gary, which company do you use for your trades and is it Level II trading

gsmith4

: I use Yamner and Co. THEY have level two and work all my orders. In short, I delegate that funciton to folks who do that stuff all the time. My specialty: trade selection, not entry and exit.

TFdancer

asks: the Euro seems pretty stable and the dollar is fluxuating, will the euro become the currency to watch

gsmith4

: Absolutely. But not more so than the dollar.

coreyschaump

asks: do you think what you do is a good occupation for kids to set their sights on for later in life?would you encourage them?:D

gsmith4

: I would not, no. In fact, I also had a column about that. It's fine once you've done a lot of other things. (Writing, though, is a fine occupation!)

jtd23455

asks: How do you track so many stocks?

gsmith4

: I use a computer program to scan the 10K stocks and just spit out the finalists.

Roger_Moore70

asks: Short or long on the S&P now?

gsmith4

: I would be short if I was forced.

balloonsacs

asks: What would you suggest as a minimum and preferred amount to trade your system successfully, or does it matter?

gsmith4

: Oh, it matters because of commissions. I'd say about 20 - 50 K.

Icover

asks: Gary, your thoughts on the poor model of daytrading by scalping. Feel this bubble will bust soon? Mant states looking into questionable practices.

gsmith4

: Yes, I think it has to bust. Main reason: most folks lose money daytrading. The number of "customers" will dry up eventually.

zeetrade

asks: Gary, didn't you used to be a sports writer?

gsmith4

: Yes, I wrote for Sports Illustrated.

StockMktWatcher

asks: Do you put much credence in chart formations (ie. double tops, head & shoulders, etc.)?

gsmith4

: Some, but not to the extnet that Edwards and Magee do. I focus mainly on congestion.

CraigKaufman

asks: Just shorted DELL. Looking for book value. Do you agree with that trade?

gsmith4

: Well, I would never short on valuation, only on technicals.

jottowag

asks: Do you still use IBD daily for your picks?

gsmith4

: I do not. In fact, don't use it at all anymore.

rcspott

asks: On average how long do you hold stocks for

gsmith4

: About 5 days. Lately shorter on the long side becasue I keep getting stopped out!

Alamakian

asks: Gary, how you relate technical analysis with the recent performance of internet stock?

gsmith4

: When you look at the charts they look like standard techical fare. Except one thing is diff: the volatility is much wider.

TFdancer

asks: What mutual fund sectors do you think will perform well in the next several years

gsmith4

: Healthcare. Maybe natural resources.

coreyschaump

asks: how long does it take you to wright a short artical?what do you have to do?:P

gsmith4

: Sometimes I can whip them out in about 3 hours. Sometimes I slave over them for two days. Maybe a half day in general. The tech forum, though takes a lot of time.

StockMktWatcher

asks: Do you look at a company's fundamentals at all when you choose stocks?

gsmith4

: No.

jottowag

asks: Gary, would you review Cooper's new site, tradehard.com and comment in tsc?

gsmith4

: Yeah, I"ll do that. Send me an email though to gbsmith@ibm.net so I remember.

zeetrade

asks: Gary, I'm surprised we don't see more sports analogies out of you. Get'em all the time from Cramer!

gsmith4

: Oh, I talk about my daughters swimming a lot. Only sport I really care about now!

rcspott

asks: Gary, would you give us your definition of "congestion" thanks

gsmith4

: Yes, sideways movement where a top or bottom price is touched a few times over the course of a few weeks.

Rrose3333

asks: why didn't yahoo fly today, is it because they now are perceived to have some competition?

gsmith4

: I think so. Also, because the PE is what? about 43,562??

badco1_98

asks: Overall what the security with online investing?

gsmith4

: I think it's safe. Haven't heard of any problems.

coriston

asks: Gary, where is Our Government Headed?

gsmith4

: I think they're all going to become day traders!

Icover

asks: Gary, have you read the lastest book by B. Rudd on trading.

gsmith4

: Have not. I do want to read that new Van Tharp book reviewed in TSC.

jtd23455

asks: Would is the next search engine to get plucked?

gsmith4

: How many are left??? Lycos I guess. (Personally, I like Dogpile!)

zeetrade

asks: Wagers on Greenspan tomorrow?

gsmith4

: He will be obtuse as usual.

badco1_98

asks: Do you invest in Penny stocks ? Thoughts?

gsmith4

: Never. Thoughts? Exactly like gambling

jottowag

asks: If you don't use IBD, then how does the average person follow your system? Your scans available?

gsmith4

: Many of them are. I'd read through my columns and check the "GBS" thread on SI and Yahoo. But....I'm really not here to promote my system. More my thinking if anything.

Jjcapostle

asks: how to you see the @home/excite deal for @home?

gsmith4

: I think it's a benefit for them. Gives them some content.

TFdancer

asks: As the baby boomers investors are depending on the stock market for the next 20 years, do you think it will fail to meet their expectations

gsmith4

: Guess it depends on their expecations.

Jjcapostle

asks: great work and you're a helluva teacher bro

gsmith4

: Thanks! Best occupation I ever had!

coriston

asks: What I meant was How is the whole Scandal situation affecting the Financial market?

gsmith4

: Oh, okay. Not effecting it at all. I'll betcha more people could tell you the price of Yahoo, than the status of Clintons defense.

StockMktWatcher

asks: Do you think the attention guys like R. Acampora (Prudential Securities) receives gives tech. analysis more legitimacy?

gsmith4

: Sure. Any publicity is good publicity.

rcspott

asks: Gary, have you or are you thinking of writing a book?

gsmith4

: Yeah, I am thinking about it. My wife said I should think about it. It's a ton of work though, and so self-serviing, I don't know if I could do it.

cali2020_

asks: What exactly is (IBD)?

gsmith4

: Investors Business Daily;

Jjcapostle

asks: why do you trade rather thab hold a great company if you're lucky enough to get in early..ala.AWRE?

gsmith4

: I'm a wuss, and get antsy with any kind of gain!

jtd23455

asks: Is Mexico and other S. American countries in some trouble like Brazil?

gsmith4

: Dont' know at all. I'd ask Padinha.

sidmyboy

asks: Gary, would your care to comment on shorting FRX or JKHY at the open tomorrow?

gsmith4

: The former I don't know about. JKHY I always look at and conclude it's too thin to trade.

jottowag

asks: Rupp's book is something like Joe Ross's books, do you still recommend Ross?

gsmith4

: I really like Ross, so yeah.

Alamakian

asks: Gary, If you use TA what are the criteria you use to scan for stock to invest? Which site? ... or software?

gsmith4

: Many many columns on this in TSC. Look throught the archives when you can.

Jjcapostle

asks: how can you gigest selling a great stock at a 10% profit when it keeps on going up to a split and beyond?

gsmith4

: I can cope with that, because I don't ride stocks DOWN 50%.

fitness_unlimited

asks: what do you think of Jeff Coopers hit and run system that use's all tech to open and close postions?

gsmith4

: I like Jeff, and he has good stuff. But... I like how I trade better. You have to find something that fits you!

StockMktWatcher

asks: What are you're key indicators that signal when it's time to get out of a trade?

gsmith4

: When I get stopped out!! I always know my stop up front.

CraigKaufman

asks: What was the largest % gain you ever made on a single trade? Ticker please.

gsmith4

: When I held a stock more than a few days, I made about 70% once. Pure torture for me, though!

coreyschaump

asks: do you have any plans for the future

gsmith4

: Yes: in 3.5 minutes I get in my car and drive my two daughters to Bethesda. After that, who knows!!

TSCEllen

: Thanks Gary for being with us and thanks for all of your great questions!

gsmith4

: Thanks all!! Read TSC!!! Thanks, Ellen!

TSCEllen

: Traders make sure to catch Tracy Byrnes and Ted Tesser next Tuesday, Jan. 26th as they talk about Day Trading tax issues.