......

c=I

Richmond & Danville-1885

Weekly Chart

Price

Completed railroad route from Richmond to+

Danville, Virginia in 1856. By 1890 it covered
3,300 miles throughout the southern states.,

400
340

300

260
220
190
... 160

. "Price up
.. weeks in black
.~.

'\

140
120

j>h

~il"t~l ...

100

~~~~~d~~~(Z~:
"'if\tlrlI';

.. High, low and ....,

..
close plotted
:
. for each week ..

...

80

.." ..
.. ! ....

...:.
..

70
60

T:t

.. ....45
38
32

America's first cup-with-handle chart base ... a

long one .. ,74 weeks of price and volume action.
. - To count the weeks in a base, begin with the first
week that closes down in price at point A. Pattern
;, .. J.
.. looks like a cup-with-handle if viewed from the side:'

"j"

I"'

.,,IL! .....1...:" ..
.~.

"...

. ,:..

28
24
..20
17

. 15
Volume

Richmond & Danville increased 257% in 70 weeks.

.,.
:]
:z
:z
:z
C)

en
-<
en

~
m
s:

Tennessee Coal & Iron-18g8

Weekly Chart

Mass-production of steel for The Spanish-American War.

lowered freight costs by using its own railroad and lowered
ope:ating costs by employing convicts.

.
c

Price

220
190
. 160
140
120
100
80
70
60
50
40
34
30
26
22
19
16
.. 14

....

-12

::T

10
Average weekly
trading volume for"
prior 10 weeks ~.

CD

8
Volume

80,000
50,000
30,000
18,000

~
~

j~

Tennessee Coal & Iron increased 265% in 39 weeks,

~
~
~
~
c
CD

--~-------------~-----~~---'---'-\-'--r.~~~~~-'-------,-""",,----1

CD

...

"""
4:.

C;.
"""
5'

""en
CD

~
~
'"

--

Northern Pacific-1900
Weekly Chart

Chartered as the first transcontinental railroad

by Abraham Lincoln in 1864. Contributed
. largely to the opening of the Northwestern
United States.

Northern Pacific Corner 1901: a financial

...
contest for control of the railroad. At the end, :~
.James Hill and J.P. Morgan secured control .:... ,..

Price

600
500
400
340
300
260
220
190
..160
140
120
....... 100
80
.. 70
60
50
40
34
30
26
22
Volume

g
b

250,000

tl

120,000
60,000

J.;

30,000

i
0

Northern Pacific increased 1181 % in 29 weeks,

nce =
Bethlehem Steel-1914
~1~~1S
80

Weekly Chart
~

70

Bethlehem Steel produced about 60% of the

Allies' munitions during World War I. American
profits for
orders
.... accounted for most of the profits.

.. domestic
steel makers chose to stabilize
...J
contracts so foreign

Price
700

60

600

50
45
40
36

500
400
340

~g
26
24
22
20
18

13
12
11
10
9.00
8.00

300
260

\.

220

190
160

... "Quarter by quarter plot of

earnings per share for prior
12 months (earnings scale
is on the left)
...

140
120
100

.......

7.00

80
70

6.00

60

5.00
4.50
4.00
3.60

50
... .40
34

~g~

30

2.60
2.40

26

Volume

~'
Q

10,600
3,600
1,200
400

~
~
i
]

~
0

Bethlehem Steel increased 1479% in 99 weeks.

......

>

Price

General Motors-1915

600

Weekly Chart

:2
:2
:2

500

-<
""....
""m

400
340
300

;s:

260
220
,.

.190
160
140
120
100
80
70
60
... 50
40
34
30
26
22
Volume

9,000
5,600
3,400
2,000

~
~
8
~
~

;;;

Jun 191'

General Motors increased 471 % in 39 weeks,

.....
c::n

..

. .. Price

Utah Securities-1924

sz

Weekly Chart .

z
z

on
-<
on
-<

s:

--50
.45
......

40
36
32

... 28
26
24

22
20

18

Volume
i

30,000
14,000
6,000
2,000

!
..,.
d

Ji

i
0

Utah Securities increased 538% in 63 weeks,

Du Pont de Nemours-1925
Weekly Chart
/- __

.:....,
__

-:-

-:-__

..,-

-.1

A leader in science and technology across many

industries including agriculture, film and automotive.
Hybridization of seed corn in 1926 by Henry Wallace and
moisture-proot cellophane were 2 notable achievements:

Price

340
300
260
220

..

190
Market correction

: Market correction

160
140

i
.~

....
l-

c
....

" ..

120

100
80
70
60
50
40
34
30
....1..

I.

. 26

35-week double bottomwith-handle

.. 22

Shakeout but .. ' ..

never 8% below:
last buy point

19
16
14
12
Volume

130,000
50,000
16,000
6,000
2,000
Dee 1929

Du Pont de Nemours

increased

1074% in 225 weeks.

~
~
~
~
~
0

--"
co
Price

20'eps

Burroughs Adding Machines-1926

Weekly Chart
9g8
7.00

6.50
6.00
5.50
5.00
4.50
4.00
3.50

The largest manufacturer of adding machines

in the first half of the 20lh century. In 1925,
they introduced the "Burroughs Portable" that
weighed less than twenty pounds .

:2
:2
:2

co

120

en
-<
en

100

-f

"'
is:

80
70

'Market correction

3.00

60

2.50
2.25
~ 2.00
1.80

50
. 40
34
30

U8
1AO

1.30
1.20
1.10
1.00
0.90

>

Price

160
140

26
.Earninqs acceleration
begins

22
19

8:9g
0.70

16
14

0.65
0.60
0.55
0.50
OA5
DAD
0.35

12
10

0.30
Volume

30,000
14,000
6,000
2,000

~
~
c

l
"ic

"
Burroughs Adding Machines increased 1992% in 168 weeks.

Price

20'eps

IntI. Business Machines-1926

Weekly Chart

20
18

Price

IBM was expanding and developing new, successful products

in the 1920s. In 1925, it released horizontal sorting machines.
with a speed of 360 cards per minute and the first standard
duplicator. In 1928, it redesigned the punch card to hold
almost double the previous capacity.

500
400
340
300

19
14

13
12
11
10
9.00

9:gS
7.00

6.50
6.00
5.50
5.00
4.50
4.00
3.50

260
.... Market correction.

220

Very important: after shakeout, .

... if stock comes back up through'
tu-week line on even greater
... volume you must buy it back!

..,Vertical lines on earnings line

mark when earnings report
'was released
,
~

100
80
70

2.50
2.25
2.00
1.80

1.30
1.20
1.10
1.00
0.90
0.80

160
140
120

3.00

H~
1.40

190

. 36-week cup-with-lonq-handle
.that finally corrects for wedging
.uP along lows by shaking out. lt
then goes up 400%

.Sell: down 8% from cost

due to premature buying,
.
.. 'stock wedged up along lows:'
...over prior 12 weeks. Handle:
.should drift down along lows

60

Key:A successtul investor learns to do what mostlnvestors

are not willing to do. Psychologically, most investors don't
use charts, do not want to buy stocks making new highs,
and can't bring themselves to cut every loss at 8%. Even
. fewe'r'i:an bring themselves, after selling a stock at a loss,
to buy it back higher. This is the difference between
successful and unsuccessful investors .

45

..

::'

.::

::

38
32
28
24

-t

:::r
CD

20

In

17

Cil

Volume

~
:i:;3

14,200
7,800
4,200
2,200

j
.j
i

~
~
~
CD

..,
CI

':""

-a
,:;-

...

"i"
en

cc
CD

~
CD

International Business Machines increased 400% in 161 weeks.

S-

ee

Price

20eps
15
14
13
12
11
10
9.00

Wrl'g ht Aeronautical
Weekly Chart

1927

One of only three companies that continued

..manufacturing aircraft engines after World War 1:"
..Most u.s. fighter planes used Wright engines in
the 1920s. The revolutionary alr-cocled engine
, debuted in 1927.
i-..
..--{.
..... _,".l
. ~..-...

. .............
,

.... ~.

, Do Noi Buy Here! Note this is

........... + 3rd stage base. Seven weeks ago"
fast run-up to 91 with stalling,
closes barely up for week on
.._.... ' ..greater volume than prior week.
. Stock also wedges up along lows.

....... ;.
~...._... ...i.

,;' ......

220
... ..190
160
..... 140

..
Buy
.

.120

; ,

.T--T~-Ti-~~-y

..... ~.

300
260

_1.[Buy

2.50
2.25
2.00
1.80

.... 100

... 80
..... 70
60

Buy as soon as stock

, i recovers back above
jL..l. 1D-week moving averaqe
i ' line on volume.

~ ";---""",<,.:j.;'i

.... 45
38

, Add after few weeks below .i...... ,...,

""lD-week moving average
... : line as stock goes back
, above
.....
~ line on volume
-r .

U8
1.40
1.30
1.20
1.10
1.00
0.90

0.65
0.60
0.55

Price

.~/.,.,.

3.00

8:9g
0.70

... !.. !...

""'==~============~..

~ 9g8
7.00
6.50
6.00
5.50
5.00
4.50
4.00
3.50

...~..+ ..~..

.~.. ,j..

.. ,.

,,~,

.. ~ .. r-......... :..

... .;, ..

}"

... ~'C,;

:1..
..:
: Huge above ' .. '
Big volume on prior average volume
.... uptrend to base ..... , . . . , .. ,

:
.

+-

,,~,

" .

32
28
. 24
.......20

.;,

: .. Breakout week ..... ; .... i ..~ ...

, .. volume higher .,
!ha~P\io~\V~ek :

......:

..+.,

..17
15
13
11
Volume
80.000
50,000
30.000
18,000

Wright Aeronautical

increased 464% in 76 weeks,

Price ::0
20-eps
6.50
6.00
5.50
5.00
4.50

Rad io Corp of America-1927

Weekly Chart

p.-----------_,__-----------------------'

Price
140

'

120

Radios gained in popularity during the 1920s

+trorn 5,000 in-home sets in 1920 to over 2.5
..million by 1924. In 1926, through mergers .
and acquisitions with RCfis own network, the
;.National Broadcasting Company (NBC) became
the first major broadcast network in the U.S.

100

4.00

80

3.50

70

~ 3.00

60

2.50
2.25
2.00
1.80

U8
1.40
1.30
1.20
1.10
1.00
0.90

8:9g
0.70

50

. Remember: examples of great winners are split-adjusted for all splits. Don't fall
.... jnto trap of incorrectly thinking because buy point marked on RCfis chart was
. 14, that was the real price at that time. It was really 5 times 14, or 70 since
'-all stocks in these 100 examples have been adjusted for stock splits (note the
..:.5. for 1 split shown at bottom far right just above the volume weekly bars. For .
example both Cisco and Microsoft's 1st buy point on their first base was in the
.. $30 range and Google was $113. Ofthe more than 1,000 models we have of
history's greatest winners, the vast majority began by coming out of their first
'base from $30 up to $100 or more, Since our rules are historically proven,
we avoid $3, $5, and $10 stocks because the quality, liquidity and caliber of
: sponsorship is much lower. Our minimum is $20 for stocks on the NYSE,

40
34

26
22
19
. .. ",.

16

Shakeout of buyers
who were wrong in
buying from 3rd stage .....
base breakout to new high.

0.65
0.60
0.55
0.50
0.45

14
12
10

~~
~~

8
7

~W6
0.25:5for
on

. .

1 split

----~----------------~----------~----~----------~------~--~----~--------~--~AtT._~~--~--~t_--~~~~J~1f---~
Volume
]

1,600,000
800,000
400,000

Radio Corporation of America increased 739% in 74 weeks.

t
j

.~

~
~

Price =

20eps
6.00
5.50
~ 5.00
4.50
4.00
3.50
3.00

Minneapolis-Honeywell Regulator-1933
Weekly 'Chart

Company was responsible for the invention .

of the pyrometer and the thermostat. In
1934, it began an aggressive expansion'
strategy,includi~g loreignmarkets,

Price

120
100
80
70

60

Buy: comes back over

.
1O-week moving average'
'Iine on volume increase

.Market correction

2.50
2.25
2.00
1.80

50

'0'

H8
1.40

40
34
30

1.30
1.20
1.10
1.00
0.90

26

89g

16
14

0.70
0.65
0.60
0.55
0.50
0.45
0.40
0.35

22
19

Notice how this

"finally is tighter
..Base-on-base-on-base
'loose than prior
, (3 bases, each correcting" .. and September
.. : and stopping in top area ot:.
. previous base)
.

3rd base-an-base
and less wide and'
bases in March
1934
..

12

i ..

':

10
.

0.30

0.25
0.23
0.20

4.5
Volume

3,200
1,600
800
400

;i..

J
"i

~
~
0

Minneapolis-Honeywell

Regulator increased

987% in 170 weeks.

Price

20'eps
14

13
12

Price

Five cents bought you a Coke in the 1930s.

Coke was expanding into foreign markets and
was becoming a bestseller in Western Europe:

300
260
220

11

10
9.00

H~

190
Market correction ... Mar~et correctiQn

160
140

7.00
6.50
6.00
5.50
) 5.00
4.50
4.00
3.50

120
100
80
70

3.00

60

2.50
2.25
2.00
1.80

45
38

H~
1.40

.,

1.30
1.20
1.10
1.00
0.90

, , .. :

.............. 32
, : ,
28
24
20
17
15

8:9~
0.70
0.65
0.60
0.55
0.50

13
11

Volume

t
13,800
5,000
1,800
600

j
.~

~
g

Coca-Cola increased 565% in 165 weeks.

nce =
~oeps
7.50
7.00
6.50 1-----..,--------'
6.00
5.50
5.00
4.50
4.00
3.50

sz

160
140

z
z

en

120

-<
en
....

100

80
70

3.00
2.50
2.25
2.00
1.80

..

Price

.One oi only a felv competitors left standing in the

farm equipment industry after the Great Depression ..
. Although it was losing money in the midst of the
Great Depression, Deere gained farmer loyalty by
carrying farmers' debts for as long as possible.

3:

60
....

50
......

U8
1AO

1.30
1.20
1.10
1.00
0.90

, ...

40

34
30
" ................... 26

............ ,... ,... ,., ........ " .......,............

22
19

89g
0.70

... 16
14

0.65
0.60
0.55
0.50
OA5
OAO
0.35

....... ~ ..,............

12
.. 10
8
7

0.30

0.25
Volume

25.000
10.400
5.000
2.400

t
j

j
~
0

Deere & Co increased 307% in 104 weeks.

Price =
10'eps
~ 11
10
9.00

Schenley Distilli ng-1943

Weekly Chart

r~~"'-:-~~~~~~~~~~~---"

'In 1941, Schenley Distilling was, by government

mandate, producing alcohol around the clock tor..'..
wartime use. It also began mass production ot
~~~i;i~~~:~~~~~i~~;rn~~(

s~~;~eP~r~~~I~~ue.

Price
120
100

8.00

80

7.00

70

6.00

60

5.00
4.50

50

4.00
3.60

40
34

~a8

30

2.80
2.60
2.40
2.20
2.00
1.80

26
22
19

U8
1.40

16
14

1.30
1.20
1.10
1.00
0.90
0.80

12
10
8

0.70

0.60

0.50
0.45

-I

:::r
CD

c:t

<il

4.0

0.38

Volume
40,000
14,000
6,000
2,000

~
~

~
0

Schenley Distilling increased 1164% in 185 weeks,

~
~
~
CD

'".....
I

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...
:;"
5"
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en

...
CD

'"
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c..:n

Conde Nast Publications-1944

Price =
10*ep$
~ 6.00

Weekly 'Chart

P-_--''-----,

5.00
4.50
4.00
3.60

H8
2.80
2.60
2.40
2.20
2.00
1.80

-----------'off.

First publisher of lifestyle magazines such as their trend-setting

..; . .;;..1'\. /rY'{
fashion magazine, Vogue. During the 1940s paper shortage,
~..
Sell: climax to.p. J...
Conde Nast benefitted as less profitable publications were killed
:.
:'.
Additionally, the government paid for advertisement-free
.:..
Dow Jones Ind.
.
magazine~and boo~Sfor thetroopsoverseasduring
W9rld Warl!
';H .. :.. 'H":
: 'T~
T

Price
70

"-

I '.

.'.

~.

60
50

40
34

Market corrections
create stock bases

.. 30
26
22

Earnings acceleration
HH

H~
1.40

19
16

HH

1.30
1.20
1.10
1.00

H.

14
12
10

0.90
0.80
0.70
0.60
0.50
0.45

4.5

0.40

3.8

0.36

3.2

8~il
0.28

2.8

0.26
0.24
0.22

2.4
Volume
3,200
1,600
800
400

~
,

.1.
.
0

"
Conde Nast Publications increased 514% in 101 weeks.

Gimbel appealed to iower- to medium-price clientele with the' bargain

basement of Gimbel Bros. stores and to higher-end shoppers with
their Saks stores.
stores inside the department stores,

....

A.O

::r-

3.4

CD

In

3.0

Cil

~
~
~
c:>
CD

Volume
19,400

11,200
6,400

3,600

2,000

~
e
Gimbel Brothers increased 674% in 103 weeks.

':'"
"'CI

..
5
;;j"

<=

C/O
CD

~
en
~

-..

I"'-:)
CO
Price

20'eps

Outboard Marine-1954
Weekly 'Chart

'-.- __
.,2.50 /- __
2.25
2.00 .;..
~ 1.80
... Prices are adjusted for 3-for-1 stock
.; . split. so price atbreakout was S13.50.
1.40
1.30
1.20
1.10
1.00
0.90

J>

.. Price

'Materials' restrictions were lift'ed after the Korean

;War ended in 1953. This led to rapid expansion
.tor Outboard Marine. It broadened its base by
---....I.using
its motors in snow blowers, lawn mowers, .
'and chain saws to increase year-round sales,
........ :rather than just sumrner:oriented boati~g ~ivity.

sz

60

z
z

50

C>

40

en
-<
en
....

.. 34
30
.... 26

....

UB

.....

;;:

22

_'r~~~ti":

89g
0.70

19
16
14

..~. ..,.!.

0.65
0.60
0.55
0.50
0.45
0.40

. 12
.;, .. .:.

.... i..K.'
.: .

,;

_ ..

10

..

.... < .;-

0.35

-;

,,,c,

',' You may ask, why shouldn't you buy here at the
7
: bottom to get a lower price? You are not trying to buy. ....... 6
at the cheapest price, but at the time the stock has
~..
:. the greatest probability of going up in price. When it'L
..5
declining in price 9 weeks in a row below its 10-week '
moving average line, only 3 or 4 out of 10 will be right:
, ,buys, assuming fundamentals are the same. Buying :
4.0
........ : .... when it's moving up and breaking out of a sound base.
3.4
! 'near a new price high, 6 or 7 out of 10 will be right, .
........ :---:- during bull markets. Most people like t~ buy stocks
.. 3.0
.......... ,... ,. gOing down when they look cheap, that s why they
2.6
. . make more mistakes and lose more money.
2.2

0.30
0.25
0.23
0.20
0.18

R:1~
0.14

0.13
0.12
0.11
0.09
L-----~----_7------~~~~--~~----_t----~~----------~----~----~----~------~~r_~~~--~~~~~~~~~-r~~~--~V~o~lu~m~e--~~

30,000
16,000
8,000

j
_

4,000
2,000
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Outboard Marine increased 720% in 177 weeks.

=~--;~o
J

Kaiser Aluminum-1954
Weekly Chart

.HeynoldsAlurninum broke out to new highs a few

weeks earlier and Alcoa broke out after Kaiser, meaning
this was an industry turnaround for the leaders in the'
'group' Rexnoldsad,vanced a ~il11i1a.ral11ount:

.. Price
120

, .. ,

80

60
.. 50

10

7
-I

:::r

c-,
CD

4.5
Volume

CiI

S.
1
{
0

80,000
50,000

30,000

'i

18,000

Kaiser Aluminum increased 379% in 93 weeks,

CD

:'!l.

~
C>

":'"

...
"12

C;:;'

:;'

CCI

CD

en

~
~
'"
r-,:)
c.o

c:::::)
Price

20"eps
3.50

Thiokol Chemical-1957

Remember 90% of all cup with

. handles are formed during market
.. corrections. These will be the new
leaders ...so don't get discouraged
-and stop looking for winners just
because the market is in a correction.

Weekly' Chart

3.00
2.50
2.25
2.00
1.80

U8
1040

.~
--

--<.""

-~

'"

,<'

""~

"

'"

80
. 70

z
z
z

60

C':>

en
-<
en
....
rn

50
40

~-..y
..

..

Price

"

'!"

~U8
1.10

s:

34
30
26
22

1.00
0.90

19

89g

16
14

0.70
0.65
0.60
0.55
0.50
0045
0040

12
10

0.35
0.30
0.25
0.23
0.20
0.18

4.5
3.8

m
0.14

3.2
2.8

0.13

Volume
~'

150,000
80,000

40,000

'i

20,000

j,~
c

Thiokol Chemical increased 860% in 109 weeks.

Price

20'eps
3.50

Brunswick-1958

Company has new productautomatic pin-spotters for

bowling alleys

Weekly Chart

3.00
2.50
~ 2.25
2.00
1.BO

H8
1.40
1.30
1.20
1.10
1.00
0.90

892
0.70
0.65
0.60
0.55
0.50
0.45
0.40

Price

Sell: cli~ax top.~

,'J+tt~

70
60
50

"B.' .......

.
...-

,..

--

. ... -

_..

'. - -

40
.

..

3 weeks'
.... tight closes' ..
Sharp pullback ... ;.

..

,.1957 Bear Market.'.

26

h ....

,~~~JD0
. ;- .
and PO~~ir~e

Big earnings ..
acceleration .
.. quarter,,\"

34
30
22

19
. 16
14

, ,

".,

..

12
10
B

0.35

0.30

0.25
0.23
0.20
0.18

4.0

....
:0-

3.4
3.0

m
0.14
0.13
0.12

CD

2.6
Volume

CD

~
~
0

160,000
BO,OOO

40.000
20,000

'i:j

'i"

~
~

"
Brunswick increased 1500% in 162 weeks.

a:'
'"CD
~
~

'"n
'7

....

..
n'

:;'
CCI

en
CD

~
~
'"
c...l
--0.

Price

20eps
12
11
10
9.00

Price

Zenith Radio-1958

260

Weekly Chart

220
190

9g8
7.00

160
140

6.50
6.00
5.50
5.00
~ 4.50
4.00
3.50

120
........ 100
80
70
60

3.00
2.50
2.25
2.00
1.80

45
.. r

..

38
.......

H8
1.40

32

.. 28

1.30
1.20
1.10
1.00
0.90

......... 24
20
17
15

~:9g
0.70

13

0.65
0.60
0.55
0.50
0.45
0.40

11
9
Volume

80,000

50,000
30,000
18,000

~
~
"j

Zenith Radio increased 493% in 66 weeks.

Price

20'eps
14
13
12
11
10
9.00

Texas Instruments-1958
Weekly Chart
....... !

Price

leader in new semiconductor

.industry

300
... 260

. ...~.

..~.

190

9g8
7.00

6.50
6.00
5.50
5.00
4.50
~ 4.00
3.50

220

160
140
120

"'19S1Seai

Market':::'
creates new bases ."
for eaph new cycle

100

,,,,

3.00

...... 80
70

,60

2.50
2.25
2.00
1.80

50
,Two quarters of deceleration 'in
rate of quarterly earnings per share
40
... growth from the earlier major growth
.... trend rate can frequently can be a
34
-time to sell +22%, +21 % versus
... 30
-,+59%, +129%, +97%, +87%.
26
. Texas Instruments made a great
'precedent for when to sell Google
'''at over 500 in Jan. 2008 when it
22
....snowec 4 quarters of earnings
.. 19
.deceleration to 39% from earlier
16
. trend of 129%
14

U8
1.40

1.30
1.20
1.10
1.00
0.90

m
0.65
0.60
0.55
0.50

-t
:::r
CD

12

C':I

Cil

10

~
~
~
CD

Volume

!
16,000
8,000
4,000
2,000

i
~
.:

Texas Instruments

increased

772% in 116 weeks.

C>

....
c:r
,...
":""

5'
CCI

CI>
CD

~
~
en
CAl
CAl

:..-

Universal Controls-1958

Price

Weekly Chart .

2:

100

2:
2:

... 80

C'>

en
-<
en
....

70
60

s:

50
40
34
30
26
.......

22

19
16
14
12
10

Noie

numberoiiight
..
'. weekly closes and ' ..
'. tiny spreads each
week from hi to low,
'.:
! : ' Fast drop after
,....: .... 'cjimax top, sell if
you hesitated to sell
stock onthe way up

8
..7

6
4.5

3.8
Volume
120,000
70,000
40,000
20,000

Jun 1959

Universal Controls increased 645% in 51 weeks.

.;;
'e

j
.~

~
~
0

Price
20'eps

Price
220

10
9.00

190

9~8
7.00

160
140

6.50
6.00
5.50
5.00
4.50

120
100

4.00

80

3.50

70

3.00

60

2.50
2.25

50

2.00
1.80

40
34

U8

30

, 1.40
1.30
1.20
1.10
1.00
0.90

26
22
19

89~
0.70

16
14

0.65
0.60
0.55
0.50
0.45

12

....

10

::T
CD

In

0.40

ii:l

0.35
Volume
18,200
10,600

g
i

6,200

3,600

2,000

~
Q

Xerox increased 1201 % in 188 weeks,

~
~
~
CD

...
C)

':'"
.."

...
;;;'
:S'
(Q

en
CD

~
~
en
CJ.:)

c.:n

Price

20'eps

2.50
2.25
2.00
1.80

American Photocopy Equip,-1958

...... Price

Weekly Chart

..50
40
. 34
30

H8
1.40
1.30
1.20
1.10
1.00
0.90

26
22
19
"

~9g

, ,
........

16
14

~ O~~

... 12

0.60
0.55
0.50
0.45
0.40
0.35
0.30

10

.J__ J'~'+~~~.f=:~~~7,.,.:r
..n~'vI;\/..:0 ,

~~'.,. i'

, ; ; ;....
i..';
..;i

8
., .. ,...., ...i....C., .. , ..7

,.,...',., , , , , ,., , , ,

0.25
0.23
0.20
0.18

s. ..

, .

; .

. ..

6
4.5
.. 3.8
3.2
2.8

R1g
0.14

0.13
0.12
0.11
0.10
0.09

.2.4
2.0
Volume

g
~.

80,000
50,000
30,000
18,000

~
~

i
"
American Photocopy Equipment increased 696% in 133 weeks

Fairchild Camera & Instrument-1959

Weekly Chart

Price

190
160
140

100
80
70

60
50

-I

::rCD

~
Cil

l!:CD

Volume

~
0

16,000
8,000
4,000
2,000

.~
s

~
~

Fairchild Camera & Instrument increased 582% in 73 weeks"

~
~

...'"
':'"
."..
.,"
S"

<CO

en

...
CD

Cil

-..

Price

20'eps
6.50
6.00
5.50
~ 5.00
4.50
4.00
3.50

Chrysler-1962

Price
.

~.

Weekly Chart

100
80
70
60

3.00
2.50
2.25
2.00
1.80

140
120

50

.j..

.. 40
34
30

U8
1.40
1.30
1.20
1.10
1.00
0.90

26

89g
0.70

16
14

22
19

0.65
0.60
0.55
0.50
0.45
0.40

12
10

0.35

8
7

0.30

0.25
0.23
Volume
1,300,000
800,000
500,000
300,000
180,000

j
~
0

Chrysler increased 215% in 51 weeks.

Price

National Airlines-1962
Weekly Chart

120
100

80
70
60
50

16
14
12
10

~
::r
--4.5
Volume
130,000
70,000
40,000
20,000

~
s.
8
E

~
-'
~
0

National Airlines

increased

1004% in 179 weeks"

'"a:'
'"'"
'"
~

CI

<>

':'"
.,.
0"
,...
:;"
<0

en

'"Q

en

CJ.:I

c:c

Price

20*eps
7.00
6.50
6.00
~ 5.50
5.00
4.50
4.00
3.50

Northwest Airlines-1962
Weekly Chart

:0

Price

. New product: jet planes

.: and new route to Japan

140
120
Do Not Buy! Faulty base. narrow
..
v-shaped 2 weeks down and 2 weeks '
up off low (straight down and then
...... straight up) and handle area does not
.... drift down along its lows.

\~~~.:~-

100
80
70

3.00
2.50
2.25
2.00
1.80

U8
1.40
1.30
1.20
1.10
1.00
0.90

60
.. 1962 bear market

......

+. ,

50
.. 40

. iOoNotBuy!Sto(;ids
""extended straight up .
..; from 8 to 14 and it's
, a third sta.ge base

~~-

...... ,... ;

"~~e'~~;;~~"'.:-':
,
,/ .. ,:,-30

34
26
22
19

.... 16
.. 14

8:92
0.70
0.65
0.60
0.55
0.50
0.45
0.40

12
10

0.35

8
.. 7

0.30

0.25

Northwest Airlines increased 1240% in 186 weeks.

:!l
z:
z:
z:

en
-<
en
....
m

3:

Price =
20'eps
18

Xerox-1963

Price

Weekly Chart

.. 340

300
. ... 260

13
12
11
10
9.00

220
190

9g8

160
..... 140

7.00
6.50
6.00
5.50
5.00
4.50

120
.100
80

4.00
........

) 3.50
3.00
2.50
2.25
2.00
1.80

H8
1.40

. 00 Not Buy! Straight

up from 17.5 to 32,
3 weeks
too obvious and.
tight closes
market IS correcting ..... along lows .' Buy

70

.. 60

T'

45

.\.:~\t

38
32
28

1.30
1.20
1.10
1.00
0.90

24
20
17

8:9g
0.70

15
13

0.65

Volume
350,000

~
s.
.,
c

150,000

.~

70,000

30,000

~
~

i
Q

Xerox increased 660% in 168 weeks.

+=:00
I'V
Price

20'eps
6.00
5.50
5.00
4.50
4.00
3.50

. New product "The Pill." Syntex was on the

. American Stock Exchange when they
listeoa numbe~ of different qrowth.stocks
_i

Price

120

:2
:2

100

:2

80
70

co
en
-<
en
....

3.00

60

:s:

2.50
2.25
2.00
~ 1.80

50

.j..

. ... ;.

40
34
30

H8
1.40

26

1.30
1.20
1.10
1.00
0.90

22
19
.. 16

892
0.70

14

0.65
0.60
0.55
0.50
0.45
0.40

12
10

0.35
0.30

0.25
0.23
0.20

4.5
Volume

800,000
500,000
300,000
180,000

.;;.

il

~
~

i!
~

"
Syntex increased 451 % in 25 weeks,

Price

20'eps
3.50

Rollins-1964
Weekly Chart

Huge acquisition of
Orkin exterminator

Price
-Dow Jones Ind.

70

3.00

60

2.50
2.25
2.00
1.80

50
40
34
30

U8
1.40
1.30
1.20
1.10
1.00
0.90

26

8:92
0.70

16
14

22
19

0.65
~ 0.60
0.55
0.50
0.45
0.40

12

0.35
0.30
0.25
0.23
0.20
0.18

....

3.4

::T
CD

3.0

0.14
0.13
0.12

C)

Cil

2.6

~
~
~
CD

Volume
80,000
50,000
30,000

t"

~
~
~

<0

18,000

"

Rollins increased 254% in 36 weeks,

>;<"

....
n"
...
5"
en
CD

~
~
en
~
c;...:I

Price
20'eps

Hg
2.15

Simmonds Precision-1965

~~ice

Weekly Chart

50
44

2.00
1.85

39
.Market corrects

W
1.50

30

1.40
1.30
1.20
1.10
~ 1.00

.... 26

Key precedent for Simmonds'

..

23
20

0.93

17

8~g
0.75

15

0.70

8:g~
0.57
8:~9

-} .

~. - -.;..

0.41
0.35
0.31

8:~~
0.22
0.20
0.19

m
0.15
0.14
0.13
0.11
0.11

Volume
80,000
50,000
30,000
18,000

!,

j
~
0

Simmonds Precision Products increased 672% in 38 weeks.

~~i::p~
Monogram Industries-1966

Supplier to Boeing jet airliners

Prlcu

S&P 500

70

Weekly Chart
3.00

2.50
2.25
2.00
1.80

~U8
1.40

..

;.

. 1966 Bear market'

60

..;

50
40

34
30

1.30
1.20
1.10
1.00

... 26
..........

22
19

0.90

8:9g
0.70

16
...... 14

0.60

12

0.65
0.55
0.50
0.45
0.40

10

0.35
0.30

...

0.25
0.23
0.20
0.18

6
5
4.0
-I

3.4
3.0

m
0.14
0.13
0.12

::T
CD
CO

2.6
Volume

120,000
70,000
40,000
20,000

iiI

~
s.

~
~
0

Monogram Industries increased 891% in 57 weeks.

~
CD

!!!.

.,

CI

":'-a"

..

E'

:;i"

""en

.,
CD

iiI

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~
~

C)
Price =
20'eps
9.00

9g8

Digital Equipment-1g67
I-W_e_e_kl_y_C_h_a_rt

-,-~

..

J>o

Price

Manufacturer of iiighspeeddigital
mini-computers,
com puler accessory equipment, test equipment,
.,.
and modules:

190

2:
2:

160
140

7.00
6.50
6.00
5.50
5.00
4.50
4.00
3.50

80
.. 70

3.00

. 60

2.50
2.25
2.00
1.80

.. 40

z
C>

en
-<
en
....

120
100

==

50

34
30

U8
1AO

26

~ 1.30
1.20
1.10
1.00
0.90

........

R9g

22
19
16
14

0.70
0.65
0.60
0.55
0.50
OA5
OAO
0.35

12
10

0.30

140,000
80,000
40,000

=-----1~
L-~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Digital Equipment increased 743% in 156 weeks,

~o

Price

20'eps
3.00

Loews-1967
Weekly Chart

Price

Shortage of hotels since jets greatly

increased travel. Loews Theaters
land was used in cities to build hotels ..

60
50

~ 2.50
2.25
2.00
1.80

.40
34
30

H8
1.40

26

1.30
1.20
1.10
1.00
0.90

22
19

....... 16
14

0.65
0.60
0.55
0.50
0.45
0.40

.... 12
. 10
.

.........

0.35

......

0.30

"

.... _

'

6
5

0.25
0.23
0.20
0.18

......

4.0
3.4
3.0

R1g
0.14
0.13
0.12
0.11

2.6
2.2
Volume

!
160,000
80,000
40,000
20,000

j
~
0

Loews increased 1025% in 101 weeks.

Price

20'eps
5.00
4.50
4.00
3.50

Mattel-1967
Weekly Chart

... i"

..

. Price

Largest toy manufacturer in U.S.

" ~" .

:
:z:
:z:
:z:

100
...... 80

C>

70

en
-<

3.00

......... 60

~
m

2.50
2.25
2.00
1.80

...... 50

3l:

~..

... .

"

.. :.. , i

;..

40
34
30

U8

1.40
1.30
~ 1.20
1.10
1.00
0.90

..;

+.

1--

26
22

.. ..

19
..16

~J~

14

0.65
0.60
0.55
0.50
0.45
0.40

/.,

,/,.\. .. 'JI'',..;",,., , ,

12

,.. ,10
8

0.35

0.30
0.25
0.23
0.20
0.18

4.5
- .... 3.8

120,000
70,000
40,000
20,000
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Mattei increased 441 % in 66 weeks.

!H!ll--------1

~c

fc
!

'j
,

Price

Prtcu

20eps
2.00
1.80

40

I!w~!rlrr".J

U8
1.40
1.30
1.20
1.10
1.00
0.90

26
... 22
19

) 89g

~--"c"c.c

16

0.70
0.65
0.60
0.55
0.50
0.45
0.40

.. 8

0.35

, .. ".. .. 7

0.30

..... 6

14

12
10

0.25
0.23
0.20
0.18

... ;......... "

3.8

,..., ... ,........ 3.2

L~'l

g 1j

2.8

C--J~~~'ilOF.S:::tc'-:.:.:..:...

..... 2.4

0.12
0.11
0.10
0.09

34
30

2.0
-i ... ,.... , ., .... ; .....

889
0.07

, .................

1.7
1.5

-t

~'~05~t,~OO~~----~----------~------~----~----------~~~--~~~~----t_~~~~~~~~~~~~,--~~~~~~~-Volume
i
640,000
300,000
140,000
60,000

~ __ ~~~~~=-~~~~~~~~-c~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Skyline increased 715% in 98 weeks.

20,000
~----!~
~o

t
j

'j
-

Price =0

20"eps
2.50
2.25
2.00
~ 1.80

Redman Industries-1968
Weekly Chart

Leading producer of mobile

.homes and aluminum products ...

Price

50
40
34
30

H8
1.40

26

1.30
1.20
1.10
1.00
0.90

... 22
19
16
14

R~g
i170
0.65
0.60
0.55
0.50
0.45
0.40

0.35

12
10

0.30
5

0.25
0.23
0.20
0.18

4.0
... 3.4
3.0

Rl~
0.14

2.6

0.13
0.12
0.11

2.2

0.09
0.09

1.8
Volume

80,000
40,000
20,000

i0

~
~
,
~
~

"
Redman Industries increased 683% in 49 weeks.

Price

20'eps
4.00
3.50

Levitz Furnitu re-1970

Price

Weekly Chart

80
70

3.00

60

2.50
2.25

50

2.00

40

1.80

H8
1.40

/.,

...,..,

34
30

1.30
1.20
1.10
1.00
0.90

26

8:~g

16
14

22

19

0.70

0.65
0.60
~ 0.55
0.50
0.45
0.40

12
10

0.35
0.30
0.25
0.23
0.20
0.18

4.0
3.4

3.0

0.14

Jun 1971

Sep 1971

Dee 1971

Mar 1972

Jun 1972

Volume

320,000
160,000
80,000
40,000
20,000

j
~
Q

Levitz Furniture increased 608% in 87 weeks.

....

c.J'1

Price

20eps
4.00
3.50

:too

Rite Aid-1970

Price

Weekly Chart

80
70

:
z
z
z

C)

3.00

60

2.50
2.25
2.00
1.80

50
40
. 34
30

U8
1.40

~:.~+.,...
:
...

...
...
26

1.30
1.20
1.10
1.00
0.90

22
19

89g
0.70

16
14

) 0.65
0.60
0.55
0.50
0.45
0.40

..

12
10
8

0.35

.... 7

0.30

!,.. :...

0.25
0.23
0.20
0.18

4.0
3.4

3.0
Volume
160.000
80,000
40,000

Rite Aid increased 421 % in 71 weeks.

en
-e
en
....
m

3:

McDonald's-1970

Prlco

140

Weekly Chart

120
100
80
70

60
50
--40
..... 34
30
26
22
19

8
7
6
... 5
Volume

460,000
220,000
100,000
40,000

McDonald's increased 422% in 108 weeks,

0'1

~
Ildr.o =
;JUr.ps

4.00
3.50

Sambas Restaurants-1971

Price

Weekly Chart

80
70

3.00

60

2.50
2.25
2.00
1.80

50

>

z
z
z

co
en
-<
en
-<
m

40

UR

34
30

...

1.40

1.30
1.20
1.10
1.00
~ 0.90

26

892
0.70

16
14

22
19

0.65
0.60
0.55
0.50
0.45
0.40

12
10

0.35
0.30
0.25
0.23
0.20
0.18

4.5

81
0.14

3.2
2.8

0.13
L-~~~~

3.8

~ __~~

~~~~~~~~~~

__~~--~~--~~~~--~v~o7Iu~m~e~~]
{
80,000

40,000

20,000

mbo R

t uront Incr

d 458% In 104 we oks.

Price
20'eps
) 4.50

4.00

Prlco

Market correction

3.50

80
70

3.00

60

2.50
2.25

. 50

2.00
1.80

40
. 34

U8
1.40

30

1.30
1.20
1.10
1.00
0.90

26

8~g
0.70

16

22
19

14

0.65
0.60
0.55
0.50
0.45

12
10

0.40

0.35

0.30
0.25
0.23

....

4.5

:-

0.20
0.18

3.8

3.2

CD
C)

Volume
80,000
40,000

Ci!
.5

!
~

20,000

;;

~
~
CD

en
S"
..,

,...
....
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,...
5'
I

<=

en
CD

Sea Containers increased 448% in 59 weeks.

~
~
en
c:.l"1
c:.l"1

Price =
20'eps

3.00
2.50
2.25
2.00
1.80

~U8
1.40
1.30
1.20
1.10
1.00
0.90

89g
0.70

Flightsafety Intl.-1977
Weekly Chart

Price

Company provides high technology

training to operators of aircraft and
ships through the use of simulators.

..60
50
40

Market :correction :
......
.~

34
30

.
.

; .

26
22

::+.'#t'~~~~~'/:..

__ +-TT~tl~~~i~~

c,
.., ..

0.65
0.60
0.55
0.50
0.45
0.40
0.35

.. 19
16

.. /,.,.14
12

..., .., .. :... , ..,. . .10

0.30

......

....

0.25
0.23
0.20
0.18

........... 4.5
3.8

...c;, .... 3.2

. :, ..... :

0.14
0.13
0.12
0.11

,. ,

2.8
,.,

2.4

;---r~--f-~----~------~----~------------~~~----~~,-~----~~~~~~--~~~~----~~----~v~o7IU~m~
140,000
80,000
40,000

Flightsafety International increased 958% in 195 weeks,

s.
d

Pllco ,.

Soil: Clllll~X 11101119111wonk

alii of cup-wit i-handle

20-ops

,"<"",

2.00
1.80

40
!

H8

1.40
~ 1.30
1.20
1.10
1.00
0.90

......
~, ..~~,~~!~-

,.~;!.!

!~~'!.

~1)ftfT+ttj:~t?<

:;,*~~":/'!

34
30

\~. :.;26
22
19
..:,+: ..,
, ..,",

89g
0.70
0.65
0.60
0.55
0.50
0.45
0.40

..
..16
14
12
10

0.35
0.30
0.25
0.23
0.20
0.18

m
0.14
0.13
0.12
0.11
0.10
0.09

8:89

2.0

-t
::r

1.7

C)

1.5
Volume

480,000
340,000
240,000
160,000

CD

CiI

~
CD
~
~
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I

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><"

:;.
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en
CD

Wang Laboratories increased 1348% in 139 weeks.

~
~
en

-...

c.TI

Price

,...

Price

20'eps
9.00

. Market correction'

sz

190

9g8
7.00

z
z

160
140

6.50
6.00
5.50
5.00
4.50
4.00
3.50

80
........ 70

~ 3.00

. 60

2.50
2.25
2.00
1.80

50

CI)

120

-<

....
CI)

100

:s:

40

H8
1.40
1.30
1.20
1.10
1.00
0.90

"

22

!Add:price . 19
'back through
.;. i10-weekline 16
'on volume . 14
'increase
12

89g
0.70
0.65
0.60
0.55
0.50
0.45
0.40

10

0.35
0.30
Volume

320,000
160,000
80,000
40,000
20,000

:f
0

j
~
0

Resorts International increased 630% in 24 weeks.

I-'IIGU
20' eps
6.00
5.50
5.00
4.50

l'lh:ll

Texas Oil & Gas-1978

I~U

Weekly Chart

120
100

4.00

80

3.50

70
60

73.00
X(, '+Tt)v

2.50
2.25
2.00
1.80

50
40
34

U8
1.40

30

1.30
1.20
1.10
1.00
0.90

26
22
'" .. 19

8~~
0.70

16
14

0.65
0.60
0.55
0.50
0.45

12
10

0.40

0.35

7
-4
:::a-

0.30

CD

0.25
0.23

~
~
~
~
<=>
.,.,
CD

Volume

~
Q

300,000
140,000
60,000
20,000

j.,
B

CD

...
...
I

-a

C;'

5'

""en
CD

Texas Oil & Gas increased 529% in 101 weeks,

~
~
en
c.:n
c.c

Price

60

2.50
2.25
2.00
1.80

...... 50

z
z
z

en
-<
en
...
m

5:

.... 40
.. 34
30
... 26

1:g8
1.40
1.30
1.20
1.10
1.00
0.90

0.65
0.60
0.55
0.50
0.45
0.40

!l

.......... 80
......... 70

~ 3.00

89g
0.70

>-

Price

20'eps
4.00
3.50

,.

.. :
"~,,,-,

'.... - ..

.... . ..

~
..

Note: sharp angle up of

..... earnings line shows big %Increases In earnings for~
last 2 quarters

<

."

: '"

'

,
"',"

22
i
:

"

....

~
.

~.

19

. .. i .

. 16

. , .~.

'3 weeks
... tIght closes

..i

.. ;.... ;

,""

14

12

. Stock at paint "8"

.. 10
undercuts low of prior
area ''A" for a shakeout
'and closes in upper half" ." 8
..i
..:..of week's spread-sign
7
,.~fb"uy'i~~~up~~r~~
6

0.35
0.30
0.25
0.23
0.20
0.18

4.0

m
0.14

,-".,

3.4
..... 3.0
Volume

i'
160,000
80,000
40,000
20,000

j
~

Global Marine increased 752% in 94 weeks.

Price

20'eps

Pic 'N' Save-1979

Prlco

Weekly Chart

70

3.00

60

2.50
2.25
2.00
~ 1.80

50

; A,~0J~~~~~~~

.......
~ .. ai~rbwimMk~~

.f

~~: ,~~uv<.,!.740
34
30

U8
1.40

1.30
1.20
1.10
1.00
0.90

26

8:9g
0.70

16
14

22
19

0.65
0.60
0.55
0.50
0.45
0.40

12
10

0.35
0.30
0.25
0.23
0.20
0.18

4.0
3.4

m
0.14

3.0

....
:::r
CD
C)

2.6

0.13
0.12

;;;

~
~
CD

Volume

320,000
160,000
80,000
40,000

.,..
5!Z
co
I

-a

n"

~
:=

.,

CCI

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CD

Pic 'N' Save increased 546% in 206 weeks"

~
'"
~

en
=
20"eps
Price

5.00
4.50
4.00
3.50

Wal-Mart Stores-1980
Weekly Chart

Here's an example of American entrepreneurial innovation

and ingenuity. Begins with one discount store and creates
lower prices for everyone plus 1.5 million new jobs ..

I'V
:.

Price

120
'S&P 500

2:
2:
2:

100

co
<n
-<
<n
....

80
70

3.00

60

2.50
2.25
~ 2.00
1.80

50

;;:

40
34
30

U8
1.40
1.30
1.20
1.10
1.00
0.90

26

8:92
0.70

16
14

22
19
...........;

0.65
0.60
0.55
0.50
0.45
0.40

12

0.35
0.30
0.25
0.23
4.0

0.19

Volume

~
-%'

620,000
420,000
280,000

180,000

~
~

j
.~

Wal-Mart Stores increased 882% in 158 weeks.

Price =
20"eps

Pllcu
S&P~

30

.Sell: Second 2/1 split in;~rrlf)

only 8 months and volume;
:
increases but price weekly :.:.1'
:spreads retrace much of ; . :.. ' 'It;
same price area from 26-:30.
J

tw' ..

1.30
1.20
1.10
1.00
0.90

........
'vv\;.,

89g

,m

26
. 22
19
16
14
12

0.60
0.55
0.50
OA5

10

OAO
0.35
0.30
0.25
0.23

4.5

0.20
0.18

81

0.14
0.13
0.12
0.11
0.10
0.09

....
.. ..
..
.
, / .. ' .. About 50% of the time, stock will
: : pullback to pivot buy point after its
.. "'breakoyt,
or slightly belowbuy point
,

...........-

889
0.Q7

2.0
1.7
1.5
1.3

0.07
0.06
0.06
0.05

1.1

-"-'~,J---,V;CO.,..lu-,mc:e--1
1,640,000

980,000

580,000

340,000

200,000

==c----1~
see
1983

The Limited increased 673% in 71 weeks.

.,
'&'

Price 20eps
1.80

U8
1.40

Home Depot-1982

Only in America ... two laid off workp.r<

from another hardware store start
,...W=::e:::e:::k-:,,:IY::-C:::h:::a:::rt=::===::T=-:,I''';H'oo;m;~;e'n~Depot.
It ultimately advanced
;,.
I"
,"u in once by the
. 20)0.
.. ,

'.... ,

/\

0.65
0.60
0.55
0.50
0.45

..'..y-..~
, ?:./..r.."../"
:''v-/'

/'--t

"

, ' ' ,...

, .. ,.... ,............

f'---

e ......

' .. ,

lu\

iv"

'/'7

WI
Bu

+f1T/

.).i

7'

weeks

...

10

8
7

r..

12

doses

"

RII

. ..

~:

tIT!{l

.....

26

~:

.,}V /Jp~~~- '.,.

,; .DUY'~''i~ek7/1;

.
.

'11.. ..

'r!!
. ~

..... ..-At ".'"0'" <tOO"", a

Rllurn on Equity of 37;2%

~0.25

34
..,30

' . __
.
~;yTI,TI1t1~

..

Price

J" .,.
. 'r~"l

V \. ~'I

.v

....

.t.

5100'
'Y'
.

jI'-.'' v, .. I ."...,...,..

udyatbuypoJnZ

....'''~____

....

...

.. A
., ...... 58,'1'

.-,-

.......

.....

..

."!"1~~ket,la;'

0.30

0.14
0.13
0.12
0.11
0.10
0.09

f T"

'<;:

"7

VN

0.35

0.20
0.18

...........................
,........
,
,.......
.;..;v'~ ~.~ '

89g
.~~
0.70

0.23

.,..

1.30
1.20
1.10
1.00
0.90

0.40

........

......

4,~
3.8

, ...,..
T .......
I~~~~;i;lhL,
..)B;U~y'~';~t~~1/LYi~/~~
,' , ,.........
,~t'7'
, ..,

..... ....

.00

,
.....

.,

.
....

8:89
0.07

....

...

"

,....
,..

.....

S~,t
.o~c~~k~(
c:a~m~.~e~,
v
public
dUnngbearrma~ket

....

I ..

,,-,

....
...

Sep 1979

Dee 1979

....

,
Mar 1980

Jun 1980

Sep 1980

. .''- .....

.( 5r4yV~ume

up ..(i":";j"',

Dee 1980

. ...

Mar 198'

.run '98'

2.8

2.4

. .. '..., .
1, .....

"."

.. _

2.0
.

vOlJm~

l':

'

"':II\";''Yt)

1.7
1.5
1.3
Volume

,.... .... ..L.,

640.000
420.000

'"

.'

'I',:
))

/i,.

J/rI.

''
....

Jun 1979

D'jX

'Y"

......

Mar 1979

_____________
~"

.-

:ii

fJ 7, ~ee ;\~~fkwitt

..'......

..

0.07
0.06

.!.L t+ ~:.Jwt'

... closes\

"

III, lI,wlhi'~
Sop '98' Dee '981

Mar 1982

Home Depot increased 892% in 64 weeks.

JMlW~ep

'982

Dce '982 ~oc

280.000

1983 Jun 1983.-_1_80_.0_0_0--1

1'111,11

l'llull

i'Wupu
7.UO
6.50
6.00
5.50
5.00
4.50
4.00

S&P bOO

I~U
'120
100

3.50
3.00
2.50
2.25
2.00
1.80

U8
1.40
1.30
) 1.20
1.10
1.00
0.90

8:9g
0.70
0.65
0.60
0.55
0.50
0.45

....

.........

o .

This was using the old Livermore rule for shakeout

below a $30 stock and a retracement back up to $33,
which becomes a new buy point. Since, Price Club
.,.
was in the $15 range the retracement was 1/2 of the 3
'points or 1.5 points above the first low of 14.50, which
made $16 the buy point for Price Club.
Second buy point was to-weeks later as stock emerged
out of a double bottom with handle base at 19.75 on
huge volume for the week. Stock's Return on Equity at
initial buy was 55.4% and annual earnings grow1h rate
was more than 100%. Later stock merged into Costco.

22
19
16
14
12
10

0.40
0.35

-I

0.30

CD

:r

0.25

aa
CD

Volume
300,000
160,000
80,000
40,000
20,000

1
~'

~
~
~

CD

en
CI

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Price Company increased 417% in 60 weeks,

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en

f~i::p~Stop & Shop-1982

4.50
4.00
3.50

;.S&P 500.

Price

Weekly Chart
80
70

3.00

60

2.50
2.25
2.00
1.80

50
40
34
30

188
1AO
1.30
1.20
1.10
1.00
0.90

26
22
19
__-_16

Q~g
(1.70

- --14

0.65
0.60
0.55
0.50
OA5
OAO
0.35 .'

12
Add: 2nd pullback totu-week:"
moving average line
.
Add: 1st pullback toto-week"
. moving average line

0_30
0_25
0.23
0.20
0.18
0.16

10
--8
7

......................

;T~
L----4------~----,------~----~~--~----.------~----~----~----~----~----~~~.--~~~~--~~~~--~~~------~
4.0
3.4

.i-

160,000

Stop & Shop increased 536% in 74 weeks,

80,000

40,000

1'11011
:'O~IIPII

5.00
4.50
4.00

IJlgllal 'wll.Gll
Weekly Chart

1982

:.1111 1.1111111)(l!fp

At end of 8 weeks, now uf much more

S&P 500

Note: up 20% in 1st 2 weeks,

'must hold 8ell~eeks
B ~
.
uy .

3.00
2.50
2.25

.::"

3.50

100

80

!1

.tT:

70
60

,.,

50

..

2.00
1.80

40
34

U8
1.40

~ 1.30
1.20
1.10
1.00
0.90

:;

30
...... 26

... Buy after puil back below

.: .. 10-Vleek moving average
line and as price comes
up across 10-week line
on volume increase

89g

0.70
0.65
0.60
0.55
0.50
0.45
0.40

1111 .tnl 'jlll\llllHIlUI

22
. 19
} ; ..,

16
14
.... 12

, ..,.. ,

..10

0.35
0.30

-t
::T

0.25
0.23

CD

a-

4.0

0.19

Volume

CD

;;
'a

300,000

140,000

60,000
20,000
Mar 1979

Jun 1979

Sep 1979

Doc 1979

Mar 1980

j
..
~
0

Digital Switch increased 843% in 46 weeks,

~
~
~
CD

......
...
CI

<>
I

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5'

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en
CD

~
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en

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CD
CO
Price
20'eps

"Cyclical building stock:

"',I:v-,j"

"'.'

1,80
.

'..

U~
~g~

~~

,36
:

27

~ 1.15
0,88
0,78

.., Price

.~

"" ""

':

23
19

" 16

8:g~
0.57

, " ,13
" 11

0,51

OA6
OA1
0,36

" ,,7

0,31

0,26
0,23
0,20
0,18

, 4,6
'" ,3,6

" 2,9

"""""c""''''

0,11

8:10
0,09

'
,,'

"",,,,,,2,5

~"""'"''

2,1
1,8

0,08

8:8~
0,06
1,0

0,05
0,05
0,04

0,8
Volume
320,000
160,000
80,000
40,000
20,000

Pulte Home increased 733% in 47 weeks.

I'rlcu

Prlco

20'ops

S&P500
80
.. 70

4.00
3.50
3.00
2.50
2.25
2.00
~ 1.80

34
30
. ..26

H8
1.40

1.30
1.20
1.10
1.00
0.90

89g
0.70

0.65
0.60
0.55
0.50
0.45
0.40

10

0.35
0.30
0.25
0.23
0.20
0.18

-t
::r-

4.0

CD

en
iiI

3.4

3.0
Volume

::.

.
:

320,000
160,000
80.000
40,000
:

.
Scp 1979 . Dee 1979

Mar 1980

Jun 1980

see

g
{,
0

.~

j
i

1980

"
Liz Claiborne increased 211 % in 43 weeks,

~
~
~
CD

.,
C>

'-a:""

,..
;S'
n'

=en

.,
CD

3<n

en

CC

--.I
0
Price
20'eps

3.00

Franklin Resources-1984

Price

':E
"'"

Weekly Chart

60

2.50
2.25

~
:2

50

2.00
1.80

H8
1.40

40

'"e-<n

34

rn

en
....

s:

30

1.30
1.20
1.10
1.00
0.90

Stock sells down on New York based financial

paper saying stock was overvalued; ultimately
.
'stock triples due to quarterly earnings and sates"
acceleration over 3 consecutive quarters.

89g
0.70

26
22
19
16
14

0.65
0.60
0.55
0.50
0.45
0.40

12
10
8

0.35

0.30

0.25
0.23
0.20
0.18

4.0
3.4

3.0

0.14
0.13
0.12
0.11

2.6
2.2

s.
8

160,000

80,000
40,000

Dee 1981

Mar 1982

Jun 1982

Sep 1982

Dee 1982

Mar 1983

Jun 1983

Sep 1983

Franklin Resources increased 811 % in 78 weeks,

Volume

.~

l'lleu

20eps

15
14
13
12
11
10
9.00

M icrosoH-1986

Weekly Chart
'--...,...:""'.".......,.,..,.---.,.-."....,.1

1',lclt
340

lock couucts lor Iwu years back and lorllr

then advances 100 times in price lrom 1989
to .1999. Software maker for pes and servers.

300
260

3.00

t.his4th st~genon.ba se..

'.J

..... . : 'rtflTi

Holding for 1st 8 weeks got you through l'st puliba~k down
......... ~to 40 and now you're ahead 58% rather than 20%. So due
.. c.to exceptional action, you can hold through stock's first
.j .
correction of 20%, or stock's first pullback to around tu-week
....... : moving average line, which will be another buy opportunity .
, Or you could decide to just hold another 8 or 10 weeks which
could, b~ that time, create another base!

.. How do you tell a potential big winner?

1. Stock emerges out of sound base on huge
"volume and goes up 20% in only 1,2, or 3 weeks:
2. Stock has unique new product and big
sales and earnings plus high return on equity.

120
100

80
, . 70
60

.. ,...............

45
38
.~.

U8
1.40

..

1.30
1.20
1.10
1.00
0.90
0.65 I .,
0.60
0.55
0.50

160
140

.."~i~h ft~~f\~!~"\r

~ 2.50
2.25
2.00
1.80

8:9g
0.70

190

Do Not Buy! 3 weeks is not

a base, sell on way up on . j ....

928
7.00
6.50
6.00
5.50
5.00
4.50
4.00
3.50

220

.; ..

32
28
24
20

17
15
13

11

n!

Volume

920,000
560,000
340,000
200,000
Jun 1984

Sep 1984

Dee 1984

Mar 1985

Jun 1985

Microsoft increased 272% in 30 weeks"

=CD

In
I

~
s.
8
t

.~

"

c:
~

en
S"

...
...
n
I

""CI

0;"

:;"
CCI

en
CD

3en

-..t

......
I'-:)
Price

20'eps
4.00
3.50

Adobe Systems-1986
Weekly Chart

Market
'correction'"

60

2.50
2.25
2.00
1.80

50

~: ~~ ;

:
"New issue at 5.50 runs up to 9.63, then builds
: flag of 4 weeks. Note extreme volume dry-up
", stock slowly creeps up closing tight with prior
... "weeks and tiny spread from each week's high
. .to low. Stock is under slow accumulation with
: little selling coming into stock. Little volume
i.slight move up means few people notice the
. stock It IS not obVIOUSto everyone That, along
. with strong fundamentals, is w~y it.worked.

.;-

]gR

lAD

1.30
1.20
1.10
1.00
0.90

~
z
z
z

80
70

3.00

."-<
<1:1

<1:1
....

3:
40
34
.. 30
.. 26

..

22
..19
.. 16
..... 14

~J~'

0.65
0.60
0.55
~ 0.50
OA5
OAO
0.35

>

Price

.12
... ~.

10

..;.

8
..
7

,.

0.30

.~."

0.25
0.23
0.20
0.18

: . ~.

4.5
3.8

81g

3.2
Volume
300,000
140,000
60,000
20,000
Dee 1982

Marl983

Jun1983

Sep1983

Oec1983

Marl984

Junl984

Sep1984

Decl984

Mar1985

Adobe Systems increased 307% in 23 weeks.

~
~

I.
0

1'11111

~'tJ~ "IIU

3.bO

Cas lea WllOlcsalc 1988

Weekly Chart

I IJIIIHIOI

WiI:, PI IJVhttl:11y

Price
70

pnlillci willi Sol Plica's

Price Co of San Diego

3.00

60

2.50
2.25

50

2.00
1.80

40
. 34

H~
1.40

30

1.30
1.20
~ 1.10
1.00
0.90

26
22
19

8:9g
0.70

16
.... 14

0.65
0.60
0.55
0.50
0.45
0.40

12
10
... 8

0.35

0.30

0.25
0.23
0.20
0.18

5
4.0
3.4

3.0

0.14
0.13
0.12

2.6
Volume

~
~
Q

1,600,000
800,000
400,000
200,000

j
~
0

Costco Wholesale increased 712% in 163 weeks,

-.I

+=:0
Price
20'eps

10
9.00

Weekly Chart

160
140
120

2.50
2.25
2.00
1.80

U8
1.40
1.30
1.20
1.10
1.00
0.90

3:

100

-".

4.00

3.00

2:
2:
co
en
-<
en
....

190

6.50
6.00
5.50
5.00
4.50

:5
2:

220

9g8
7.00

3.50

>

Price

M icrosoft-1989

80

: Qualcomm later did same thing in Jan. 1999 when

.. '1st base was loose and wrong, 2nd base was wrong ... Buy: Third base formed is now
. and then 3rd time it tightened up and formed correctly,. tighter, corrected less from high
breaking out in Jan. 1999 for a 20-fold advance in 1
to low, handle is in upper-half 0('
H' t . I
d ti
d ouid
.base and drifts down and has .,
. year, IS onca prece en IS a soun gUi e.
tight areas, first and second base
lVe~e,wrongthirdtirne wasri9ht
Do Not Buy! Wide . .Do Not Buyl Second
..and loose base and '... base faulty, most of price, ..
low volume breakout
work on handle in lower '
.. (1st base attempt) : . half of base, 200-day llne:'
~'
... .in downtrend

.. "r+H'+

....~.

~i;

--.. 70
.... -

60
50

--40

30
26
22
19

89g
0.70

16
14

0.65
0.60
0.55
0.50
0.45

12
10

0.40
0.35
Volume
13,000,000
8,000,000
5,000,000
3,000,000
1,800,000

!,

~
~

Microsoft increased 517% in 121 weeks.

Price =
20'eps
1.80

American Power Conversion-1990

S&P 500

Weekly Chart

36

1~g

27

1.~5
1.15

23

1)8~

19

0.88
0.78

~8~~
0.57
0.51
0.46
0.41

Price

-:

16

Fun~a~entals were grea;bef~restock made its h~ge run-ub:

3 years of annual earnings nearly doubling each year .
Annual sales growth up over 100%
Pre-tax margins at 26.9%
Return on equity at 50.7%

13
11

iIU

:R

0.36
0.31
0.26
0.23
0.20
0.18

.; . c ..

m
0.11

810 ...

,...........

Hi-tech stocks have

more pullbacks and
shakeouts making
them harder to
handle. Therefore,
'7 must really know
. company well to sit
through the
numeroustests.

9
7
6
4.6
3.6
2.9
2.5
2.1
1.8

0.09
0.08

1.5

88l
0.06

1.3

-4
::r
CD

1.0

0.05
0.05
0.04

en
Oil
S-

0.8

Volume
1,660,000
980,000
580,000
340,000
200,000

CD

;;.
'a

~
~

j
~
0

American Power Conversion increased 745% in 96 weeks,

~
~

'"':'"
....

...

n'
5'

""en
CD

~
~
en

.....

c.n

-J
CP
Price =
20'eps

Price

New drug for cancer

, chemotherapy patients,'

::E

80

:z:

70
3,00

.. 60

2,50
2,25

50

2,00
1,80

40

."en-<

~
"'
;s:

34

U8
1AO

30

1,30
1,20
1,10
1,00
0,90

26

89g

16

22
19

0,70
~ 0,65
0,60
0,55
0,50

14
12
10

OA5
OAO
0,35
0,30
0.25
0.23

4,5

0.20
0.18

..,3,8

81g
0.14

3,2
2,8

0,13

Volume

i'

12,000,000

4,000,000

"

2,000,000
L-

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Amgen increased 661% in 96 weeks.

7,000,000

~=----t~
~o

~
,

~:","'~'I'''Ullllo!l 'Ialos 'lilylcal 1990

~.!~gWeekly Cilart
6.00
5.50
5.00
4.50

Market
correction.

S&P 500
_

,J

-'V

Price
140

,,,,Sell: breaks~Aj
.. channelline .; ..

120
... 100

. 80
70

4.00
3.50

3.00

..,

60

2.50
2.25

... 50

2.00

. -40

1.80

.... 34

~U8
1.40

30

1.30
1.20
1.10
1.00

26
22

19

0.90

8:9g

;Add:big volumeoff 10-week

,movingaverageand baseon-base is beingcreated
..'(correctionstoppedat prior
.base's pivot buy point

0.70
0.65
0.60
0.55

0.50

0.45
0.40

..~
-...

... ,:""1-,,,

0.35

'.j

. 14
12

10

"' .~

. ,..

. ~ -1- .~ ..

16

~..

... ~
:

.........

..7

0.30

0.25

. 5

~----r-----~-r--~----~~----~----~----~----~------~--~~----~----~~~~~----71--~~~~~--~~~~--~--~----~V~O~lu-m-e--~~
1,960,000

United States Surgical increased 786% in 93 weeks.

1,120,000

640,000

360,000

200,000

-..I
CO

f~i::p~Healthcare Compare-1990
2.25
2.00
1.80

,.,.

.. Price

50

Weekly Chart

Z
Z
C>

40
34

H8
1.40

<n
-<
<n

...
m

30

1.30
1.20
1.10
1.00
0.90

26

8:~g
0.70

16

os:

22
19

14

0.65
0.60
0.55
0.50
OA5

12
10

~ OAO

0.35

0.30

0.25
0.23

4.5

0.20
0.18

3.8

3.2

0.14
0.13
0.12
0.11
0.10
0.09

2.8
2.4
2.0
1.7

0.08
Volume
1,940,000
1,120.000
640,000
360,000
200,000

~
~
~

sr

"
Healthcare Compare increased 540% in 61 weeks.

1'.h,1I

..

j.lOu,,:3
3.50

Cisco Sy lems-1990
,...W_e_e_k-,Iy-,C...,.,..h_art...,...._.,-

-:--'

CI",," "v,,"llially 1111'1',,11111~lIl)lI

with over it 15,000% move lrom
the intial buy point in 1990

3.00
2.50
2.25
2.00
1.80

\\:rection

0.90

8:~g
0.70
0.65
0.60
0.55
0.50

OA5
OAO
0.35
0.30
0.25
0.23
0.20
0.18

.. ~
Cisco at first buy had:
33% Pre-tax Margins
36% Return on Equity
9 quarters of large EPS growth
396% Sales growth for year
ended July 1990
f45% Earnings estimate for 1991
30 PIE Ratio
7X Price to Book Value
99 EPS Rating
97 RS Rating
257% 3-year annual EPS growth
Industry Group 28 out of 197

60
50

. 'Market

~U8
1.40
1.30
1.20
1.10
1.00

Market
correction

Price
70

40
34

....

30

... America leads the world in technology ..

Nothing is impossible and problems
.... are simply new opportunities.

. 26
22
19
16
14
-12
10
8
... 7

Prices adjusted for

... .; all stock splits, so
. actual price attime
of breakout was 30

4.0
-4
:::r

3.4

CD

3.0

0.14
0.13
0.12

In

Ci!

2.6
Volume
12,000,000
7,000,000
4,000,000
2,000,000

~
~

j
~

Dee 1989

Cisco Systems increased 1602% in 169 weeks.

~
~
~
CD

'"
':'"
...,
c:;:;"""

CCI

en
CD

~
~
en

-....

c.o

f~~:p~
Newbridge Networks-1992
3.00

Weekly Chart

,,-- Price

70

:
z
z
z

60

2.50
2.25
2.00
1.80

....
en
-<
en
...
m

50

3:

U8
1AO
1.30
1.20
~ 1.10
1.00
0.90

89g
0.70
0.65
0.60
0.55
0.50
OA5
OAO
0.35

0.30 I

8
7

'A'r' ...

'1'-,,;

0.25
0.23
0.20
0.18

4.5
3.8

m
0.14

3.2
2.8
2.4

0.13
0.12
0.11

Volume

8,000,000

Dce 1992

Newbridge Networks increased 699% in 49 weeks.

Mar 1993

Jun 1993

Sep 1993

Dee 1993

g
{
0

5,000,000

.~

3,000,000

.~

1,800,000

.s

~
Q

LMC 19( 2

hIlI!
~IWI!PII

U~

34

Weekly Chart

30

1.30
1.20
1.10
1.00
~ 0.90

26
22
19

~J~

.. .... :...
'

0.65
0.60
0.55
0.50
0045
0040

.~.

.... 16
14
.... 12
10

i,'-"','.,,;rJi;

.,8
,,,7

0.35
0.30

0.25
0.23
0.20
0.18

5
4.0
::

m
0.13
0.12
0.11
0.10
0.09

~.~~

0.07
0.06
L-0~.~06~~ __ ~

~ __ -D~

.. Be careful to avoid getting;"

. ~.. shaken out on 4th week
out of base, S&P 500
,
.. corrected sharply and stock
Was,ofU8o/Q.,
,..
.;.....

-.

3.4
3.0
2.6
2.2
..... 1.9
1.6
1.4
1.2

__ ~

-L-L

L-~

~ __~L- __~

~~~

__~~~~~

__~~~~~~~~~

__ ~~~~g
Volume

{
c

1,600,000
800,000
400,000
200,000

~
~

.,..,.",----j~
L-

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

~o

EMC increased 471% in 56 weeks.

oc
....

00

r-,:)

Price =
20'eps
3.00

:to

Gartner Group-1994

Price

Weekly Chart

60

2.50
2.25

50

2.00
1.80

40

:::E
2
z
z

co
en
-<
en
....

34

U8
1.40

"'
3:

30

1.30
1.20
1.10
1.00
0.90

26
22
.. 19

89g
0.70

16
14

0.65
0.60
0.55
0.50
0.45

12
10

0.40

~ 0.35

0.30

0.25
0.23

.. ,

0.20
0.18

4.0
3.4

3.0

0.14
0.13
0.12
0.11

2.6
2.2
Volume
4,000,000
1,400,000
600,000
200,000

~
~
"i
]

"
Gartner Group increased 667% in 98 weeks.

1'.11,11 ilW4IjJ::

3.00

Peoplesolt-1994

Price
70

Weekly Chart

60
50

2.50
2.25
2.00
1.80

..40

U8
1.40

30

34

1.30
1.20
1.10
1.00
0.90

26

89g
0.70

16

22
19

14

0.65
0.60
0.55
0.50
~ 0.45
0.40

12
10

0.35
0.30
0.25
0.23

4.5

0.20
0.18

3.8

81

3.2

-t
:sCD

0.14
0.13
0.12

2.8

go

2.4

CD

Volume
12,000,000
7,000,000
4,000,000
2,000,000

~
~
~
~
~
~
0

Peoplesoft increased 1145% in 129 weeks.

~
~
~
,....
CD

C>
C'>

....
I

n'
,....

<CI

en
CD

~
S.
'"

CO
CJ.:)

00
Price

20eps
3.00

~
~
!l

. Price

Alliance Semiconductor-1994

70

Weekly Chart

Market correction

',Market
'correction'

z
z
z

60

en

50

2.50
2.25
2.00
1.80

,.

of

-<
en
....

. Aftei'third roUnd
holding for BVleeks,'sf661i' '
is up from 7 to 24, over 240%, due to results, . i.

40

3:

U8
1.40
1.30
1.20
1.10
~ 1.00
0.90

8gg

16
14

0.70
0.65
0.60
0.55
0.50
0.45
0.40

.. 8

0.35

....... 7

0.30

... 12

0.25
0.23
0.20
0.18

.4.5
3.8

m
0.14

3.2
2.8
2.4

0.13
0.12

Volume

3,000,000
1,600,000
800,000
400,000
200,000

==-----1~
~o

L- __ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Alliance Semiconductor

increased 539% in 47 weeks.

1'llulI
ill"UIIII

Prleo

3.00
2.50
2.25

60

Market correction'

50

2.00
1.80

40
34

US
1.40

30

1.30
1.20
1.10
1.00
0.90

26
".22
19

S~g

16

0.70
0.65
0.60
0.55
0.50
0.45

14

0.40

12
10

0.35

0.30

price closes liP olrer ..,..... ....

C I

0.25
) 0.23
0.20
0.18

4.0
3.4

-t

=-

3.0

0.14
0.13
0.12
0.11

CD

2.6

c:t
iil

2.2
Volume
13,000,000

So
1
:i-

.,

CD

~
~

7,000,000

'"':'"

4,000,000

'B

C:;'

2,000,000

~
G

.",....
;:i'
CQ

en
CD

~
America Online increased 570% in 75 weeks,

CD

S'
00

c:.l'1

Price
20'eps

2A5

Ascend Communications-1994

Price

Weekly Chart

56
48

42

1.95
1.80
1.65

36
... 31

U8
1.30

27

1.20
1.10
1.00
0.93
0.85

23
20
17

RJ~

15

~.68

13

8gfi

11

0.50
OA6

10

'1""

~ OAO
0.37

...

8
7

0.31

0.27
0.25

5
... ..4

R:~r

4.3

~.20
0.18
0.16

3.7

m
0.13
0.12
0.11
0.10
0.09
0.09

3.2
2.8

2.4
..... 2.1

~*

889

1.8
1.6

Heavy volume withou~'

further price decline '
is support

Volume
8,000,000
5,000,000
3,000,000
1,800,000

Ascend Communications increased 1384% in 75 weeks,

..
~
:2

:2
:2
co
en
-<
en

...
m

s:

PlIeo
Price

20'ops

40

2.00
1.80

34

H8
1.40

.. 30
.. 26

1.30
1.20
1.10
1.00

22
19

0.90

8:9g
0.70

16
14

0.65
0.60
0.55
0.50
0.45

j.

12
10

0.40

.. 8

0.35

..7

0.30

~0.25

..5

0.23
0.20
0.18

3.4

3.0

0.14
0.13
0.12
0.11
0.10
0.09

2.6
2.2
1.9
1.6

889

Volume

~
~
Q

3,000,000
1,400,000

600,000
200,000
Mar 1992

Jun 1992

Sep 1992

Dee 1992

Mar 1993

Jun 1993

Sep 1993

Dee 1993

"f

i
"

Accustaff increased 1359% in 68 weeks.

co
......

00
00
Price =
20eps

3.50
3.00
~ 2.50
2.25
2.00
1.80

US
1.40
1.30
1.20
1.10
1.00
0.90

S9g
0.70
0.65
0.60
0.55
0.50
0.45
0.40
0.35
0.30
0.25
0.23
0.20
0.18

L G Industries-1995

This is all about money management and following sound rules

rather than personal opinions, emotions or being lazy and not
doing any homework but just hoping to be lucky

Weekly Chart

1. Stock up 20% in first 3 weeks 4. The next week, the stock has its first
so must hold for complete 8
20% correction and shakeout that you sit

:~3

Price

80
70

z
z
z

."en-<

60
Market correction ..

weeks from pivot buy point

l~~~u~S
~r:rt~~~ko;~~~e~0~;;~tlgn2~ere .-/""V-_.../""---"
2. At end of 8 weeks, stock
_is where your newly acquired chart reading.
is now up 33% so with more
skill keeps you on track. You see the first
. ~ progress and a better cushion,
'3 weeks of correction are on much less
... you can hold through first or
volume than average and the fourth week
second pullback to 10-week
is a big volume with the week's price up.
moving average line or first 20% So you sit through the normal 5 weeks
correction. Big winners are
correction
seldom through until they've
5. It only takes one big winner handled
gone through one 20%
properly and following time-tested rules to ..
correction.
offset the numerous normal mistakes. The
3. Now you're halfway through
stock rallies 3 weeks giving you another
the tricky battlefield of the
. buy point when another big earnings
... market, but by the last week of
report comes out. The report is the third
Nov. 1995, your stock is at a
in a row that shows EPS and sales growth
split-adjusted 28 up from your
acceleration. You add to your position over
1st buy at 11 (split-adjusted).
30, it's up over 20% in 3 weeks you hold
You are way ahead when you
..for 8 weeks, at the end of 8 weeks stock
is now 47 and you now have the edge
.. added smaller amounts. You kept. to decide to sell if either a climax top, up
your average cost relatively low
channel-line rule is violated or 12 months
so you can afford to give your
I
t
't I'
II"'
d
stock more room, especially
ong erm capi a gains se Ing IS ue.
since the last two earnings and
sales quarters accelerated.

en

-t
m

40

::

34
... 30
26

16
14
12
10
8
.. 7

4.5
3.8

~:lg

3.2
2.8

0.14

0.13

Volume
1,560,000
940,000
560,000
340,000
200,000

j
~

"
J L G Industries increased 670% in 53 weeks,

Prlco.
20'eps
4.50

Price

4.00

80

3.50

70

3.00

60

2.50
2.25

50

~ 2.00
1.80

40
34

U8
1.40

30
26

1.30
1.20
1.10
1.00
0.90

10,Neek,, .. .. ,22
19
. 16

892
0.70

.... 14

0.65
0.60
0.55
0.50
0.45

12
.... .. 10

0.40
0.35
0.30
0.25
0.23

... ..

0.20
0.18

....

4.5

=
CD

3.8

a:I

;;;

3.2
Volume

!!!.
]

30,000,000

~
~
~
~

18,000,000

80,000,000
50,000,000

~
Q

CD

~
~
CI
C':I

....
":""

n'
"""
5'
ee

en
CD

Dell Computer increased 587% in 61 weeks,

~
~
en
CO

c.c

Price
20'eps

... Price
180

7.00
6.30

P----------'

H8
g8
3.90

150
,~",

..

122

Market

..correcuon

102
84

HR
2.90

70
58

2.60

48
40

1.95

Uii
1.45

33

1.30

27

1M

22

0.95

18

89~
0.70

15

0.63

12

8~~
8~~
8j~

10

8
7
5

~ 0.26

4.7

R~~
0.20

3.9

R1~
0.15

3.2

0.13

2.6

811

2.1

0.09

1.8

8:89
0.07

1.5
Volume
130,000,000
70,000,000
40,000,000
20,000,000

Yahoollncr a

d 6723% in '130 wk.

Price

20"eps
6.50
6.00
5.50
5.00
4.50
4.00
3.50

Charles Schwab-199B
Weekly Chart

...
t S""
"

beglnOing oj new uptrend

Schwab never touches
10-week movmg average line
-trorn buy at 29 until after It
has climax top at 150
.
B
..
uy~
Wit

2.50
2.25
2.00
1.80

1.30
1.20
1.10
~ 1.00
0.90

curnax to

Stock breaks out on followthrough day in-general market,"

3.00

U8
lAO

r);::
lfJt

~llljl:'1

Schwab was the pioneer

of disount brokerages.

r,'

t~utTT-

80

d~y~~aIOr
'Wall Street
brokerage
'
firm raises
target price
50 more
j/;po,mts
OKto pullback
as long as not

,r

J..i"r::!'P

ttt~1ft~~~iIt.i~~tIltjll~

down 8% below
,yo,ur.~o~\~_::>

89g

0.70
0.65
0.60
0.55
0.50
OA5
OAO
0.35

70
60
50
40
34
30
26
~:

"Peak close on 16
;hugeyolume .. 14

OK'for handle to
'Ucorrect over8-12o/,U
12
If.i~.~e~r ,maxke! _u-l0
at time: : .
:

'

.~..!.

:
,.

-4
::r

0.30

CD

In

uu,

0.25
0.23

Cil

,
Volume

{
12,000,000
7,000,000
4,000,000
2,000,000
Jun 1999

Charles Schwab increased 409% in 26 weeks.

-i'"
]

~
0

~
~
~
=>
"...,
CD

.,
"'1:1

c;'

"...
:i'
CCI

en
CD

l
So
en

.....

CCI

Price

20'eps

m
5.75
5.10
4.60
4.10
3.60
3.10

2.60
2.30
2.05
1.80
1.55

America Online-1998

Price

.The Internet is still a young baby ..

There will be follow-on leaders.

Weekly Chart

.. 165
135
115
92

.... 72
... 62

..

.~1.

Stock on breakout runs up over .':'

4. Stock now hits a classic
20% in 1st 3 weeks, so rule is must .
climax top and must be sold
... according to the rules..
.
...; ..hold a full 8 weeks from buy point.

.
.

-;

, ,

; 2. End of 8 weeks, stock is now

Rules were followed
up 30 to 52, or +73%, had its first
.. "'key stage of the move
pullback from 48 to 40.50 and
under 30 to over 170.
closed mid-range just like precedent ; ...
of Fairchild Camera in August, 1965, .
'which then bolted up another 200%:;
....... So decision is, must hold at least . -'"
another 8 weeks since up 73% in
only 8 "Yeeks.
.
.

~.~~
U5
1.15

1.05
0.93
0.82

3. At end of next 8 weeks stock is st:: .

79 up 163% from buy point and tlrst..
2 pullbacks in a probable ascending
.base have both been support, so
sit tight.

0.57
0.51
0.46
0.41
0.36
~ 0.31

. 46
.. 36
27
23
19
Bottom week has

shiikeouf beiow ...

June '98 low and

~~~~~~~e~~pser
range, a good
sign on
heavy volume

"--1----

0.26
0.23
0.20
0.18
0.15

:
...........................

16
13
11

7
6

4.6
...... 3.6
3.1

L----t~~'L---_i~~~~~~~L-~~---------L~--------------~~--~----~----L-~~~~--~~~~~~~~~----------~i
140,000,000

80,000,000
40,000,000
20,000,000

America Online increased 451% in 23 weeks,

J U . Unlphasu 1096

1'11111
:JWUPII

m
HB

Weekly Chart

104

86
72

2.90
2.60

H~
1.95

StiIlOZ~S
;~
tight and in upper 34

Un
1.45

.~alf:o:?AdS

1.30

H~
0.93

8:9~
0.68

.. 10

~:~~

8:1r
0.37

.. ,....,

,,9
7

~g~9

~:~~

m
B:H

.... 4,2

3,5
. 2.9

0.14

0.10

B8~
0.07

..... ~:

, ,Add: off 10-week

..: ''';'moving average 18
: line
15
13

..2.4

I;,,

.. ~.

..;.. ,

-: tJtTtllHii4J?"

2.0
1,6
1.4

0.07
0.06
0.05

,1,1
0.9

B8~

Volume
50,000,000
30,000,000
18,000,000

J D S Uniphase increased 1946% in 66 weeks.

Price
20'eps

Qualcomm-1999

Price
180

S&p.soo '

Weekly Chart

... .,.155
. 135

114

4.90

98

~~8
3.90

.. Market correction.
.;. . .. .. - ..... -. ..

........+.

3.60

.. . ..... . .; .. . .. .. . .. .

84

72

3.30

62

U~

54

2.40

'" ..

~:~g
1.90

~....

47
... 41

-j

1.75

1.60

1J~Ic

35

..... .,.,

.. 30

26

1.25
1.15

22

1>:21

.,19

0.90
0.82

.. 16

~:~~

Q
8:g
0.52
0.48

0.41
0.35

0.32
0.27

,..
... !' .. "

....

,;

1. Do Not Buy!
Most weeks
...are in lower
.....'.. .. . half of base

, . 3. Do Not Buyl':
3 bottoms and .;
most of pattern'
in lower half on
base
\'

14

..: ......

...'. ,.. ,

'.J'

.:F'

< ....

; ... ; ...........

10

9
..7

'~h

~\

.,12

5
up,',

0.25

~:~~

.,-,

..,

........

4.2

'~t7~7-'-""----"7V-;::O-;:"lu=m=e-l

.s
{

80,000,000
40,000,000
20,000,000

Qualcomm incr '"

d 20 1% In 4

1(.

Price
20'eps

5.00
4.50

Taro Pharmaceutical-2000

Price

Weekly Chart

100

4.00

80

3.50

70

3.00

60

2.50
2.25

50

2.00
1.80

40

H8
1.40

~m
1.10
1.00
0.90

22

89g
0.70

16

19
14

0.65
0.60
0.55
0.50
0.45
0.40

0.35

0.30
-I

0.25
0.23

::T

4.5

0.19

CD
Q

Cil

3.6

0.17

Volume
2,500,000
1,340,000

:::.
.,
0

740,000

400,000

220,000

~
0

~
'"
~
~
<:I

':""
.r,.,.
;;;"
en
"1:1

CD

Taro Pharmaceuticals

increased 382% in 39 weeks.

So
en

c:c
c.:n

co
en
Price
10
9.00

9g8
7.00
6.50
6.00
5.50
5.00
4.50

z-

.... Price

20"eps

.....

:!l

220

.... ;Do Not B~y! Stock 'was not proper ..; ..

'double bottom, did not undercut
.., 1st bottom, less volume on
.." breakout week, 2 for 1 split stock.
.should correct before moves up

z
z
z

190

co
en
-<
en
....

.. 160
140
120

rn

3:

100
....

4.00
3.50

80
70

3.00

...

2.50
2.25

.... .... 50

60

"

2.00
1.80

40

.....

U8
1.40

.. 34
30

1.30
1.20
) 1.10
1.00

26
.... 22
19

0.90

8:9g

16
.14

0.70
0.65
0.60
0.55
0.50
0.45
0.40

... 12
10
8

0.35
Volume
80,000,000
50,000,000
30,000,000
18,000,000

~
~
~
~
.:
~
~

,,;

eBay increased 282% in 115 weeks.

1'111111

:Wupu

Decker Ouldoor-2003

1'lh,1I

60

Weekly Chart

50

2.50
2.25
2.00
1.80

40
34
30

~ 1.40
HR
1.30
1.20
1.10
1.00
0.90

... <.

26
22
19
16
14

89g
0.70
0.65
0.60
0.55
0.50
0.45
0.40

12
10
8

0.35

0.30

0.25
0.23
0.20
0.18

5
.... 4.0

81g
0.14

3.0

3.4
2.6

0.13
0.12
0.11
0.10

2.2
Volume

1,660,000
980,000
580,000
340,000
200,000

~
0

j
-j

:
0

Deckers Outdoor increased 766% in 88 weeks.

c:c

CO
Price
20'eps

Price
108

4.50
4.10

92

3.10
2.80

66

78
56

47

2.10

1~g
1.60

.........

1.45

29

Characteristics of a high tight flag:

1. A rare pattern usually seen only once or
twice during a bull market year.
2. Usually a little known company, not widely'
.. known and certainly not the largest company'
in Its industry.
.3. Company has a new product that turns
the not so well known stock into one that
.... runs up rapidly, 100 to 120% or more in only
.... .4 to 8 weeks and holds most of the huge
.
gain while it moves sideways 3 to 5 weeks
and corrects between just 10 to 25%

H~
1.10
8~A
0.82
0.75
0.68

~ 8g/;
8~~
0.43
0.36

24
. 20
.. 17
14
.,.,," ..". ...,

12
...

10

..... 8
7
6
...... 5

0.30
0.27

8:~~
0.20
8:1~
0.16 I

40
34

4.4
.. 3.7

3.1

0.14

2.6

BH
0.11
B8~
0.08

2.2
1.8
1.5

0.07

B8g

1.3

Volume
25,000,000
12,000,000
6,000,000
3,000,000

Jun 2004

TA

R Int rn 1'1n I In r

d 22280/0 In 39 w

ks.

Price
260

Price =
201
11
10
9.00

els

. 220
190

9:28
7.00

160
140

6.50
6.00
5.50
5.00
~ 4.50

120
100

4.00

80

3.50

70

3.00

60

2.50
2.25

45

2.00
1.80

38

J:gR

32

1.40
1.30
1.20
1.10
1.00
0.90

28
24
20
17

2
89
0.70

15
13

0.65
0.60
0.55
0.50
0.45
0.40

11
9

Volume
140,000,000
80,000,000
40,000,000
20,000,000

t
J

.~

i"

Apple increased 1418% in 199 weeks,

co
CO

.......
~
~
Price .,.

20eps
2.50
2.25
2.00
1.80

Southwestern Energy-2004

- .

Weekly Chart

:z
:z

40

en
-<
en
....

UR
1.40
1.30
1.20
1.10
1.00
~ 0.90

26

89g
0.70

16
14

0.30

~
:z

. 50

34
30

0.65
0.60
0.55
0.50
0.45
0.40
0.35

..

Price

60

C>

3:

22
19

12
Note tiny spreads for 4 weeks

....~....

......

. "price variation)

~,

10
8
6

0.25
0.23
0.20
0.18

5
4.0
3.4

R1g

3.0

0.14
0.13
0.12
0.11
0.10
0.09

2.6
2.2
1.9
Volume

20,000,000
11,000,000
6,000,000
3,000,000

.~

i
"
Southwestern

Energy increased 556% in 83 weeks,

Prlco.
20'eps
4.00

C B Richard Ellis-2004

Price

Weekly Chart

80

3.50

70

3.00

60

2.50
2.25

50

.1

40

~ 2.00
1.80

34

Q
19
1.40

30

1.30
1.20
1.10
1.00
0.90

26
,22
19

,"

,.,

~:~~
0.65
0.60
0.55
0.50
0.45

,.. ,.

16
14

I,,,

12
10

0.40

8
7

0.35
'

0.30

0.25
0.23
0.20
0.18

....

=-

.... 4.0

I ....

r==~~==r
..'-Earnings

CD

3.4

acceleration

E7
CD

3.0
Volume
12,000,000
7,000,000

Jun 2003

Sep 2003

Dee 2003

Mar 2004

tj

4,000,000

.~

2,000,000

~
~

~
~
CD

en

..
n
....
0;'
I

..
5'

CC2

en
CD

C B Richard Ellis Group increased 538% in 149 weeks,

3-

-en

Price =
20'eps
70
65
60
55
50

Google-2004
Weekly Chart

45
40
35
30
25
22
20
18

19
14
13

12
11
10
9.00

9gg
7.00
6.50
6.00
5.50

5.00
4.50
4.00
3.50
3.00
2.50

Google increa ed 536% in 164 wk.

t'ucu
20eps
Price

2.05
1.80

36

~.~~
U~

27

1.15
1.05
0.93
~ 0.82

23
19
16
13

0.57
0.51
0.46
0.41
0.36
0.31

11

9
7
6

0.26
0.23
0.20
0.18

4.6
3.6

~.~~

2.7
2.3

0.11
0.11
0.09
0.08

2.0
1.6
1.4
1.1

0.06
0.05
0.05

0.9
Volume

,
s.

;3

16,000,000
8,000,000
4,000,000
2,000,000
Jun 2002

Sep 2002

Dee 2002

Mar 2003

.~

~
~
~
c

Jun 2003

Hansen Natural increased 1219% in 86 weeks.

Price =
20'eps

Titanium Metals-2005

Price

Market correction

Weekly Chart

1,80

",36

U~

27

1,15
1,05
0,93
~ 0,82

23
.. 19
,,,

m
0,57
0,51
0.46
0.41
0,36

16
13

,.. 11

I,c, ... ,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,

,,,

0,31

0,26
0,23
0,20
0,18

" 3,6

4,6

",

0,11
0,11

0,09
0,08

"" 2,9
,,,, , 2,5
,,2,1

1".:,"-

,,,,,,,,,,,,, ,,,, ,,,,,,,,,

"c"",

1,8

"""",

~:~!

1,5
1,3

0,06
0,05
0,05
0,04

,,,,,<,,,

"

.. ,

1,0
,,0,8

L-~~--~--~~~~~~--~~~L-~~~~~~~,,--~=r~~~~~~~--~v~ol~um~e~'
30,000,000
16,000,000

B,OOO,OOO

4,000,000

'~

2,000,000

'-------l~
~o

L-~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Titanium Metals increased 764% in 49 weeks.

1'111:11 _

20'ops
13
12
11
10
9.00

Precision Castparts-2005

Price

Weekly Chart

260
220
190

9~8

7.00
~ 6.50
6.00
5.50
5.00
4.50
4.00

100
80
70

;.. ;

3.50
3.00

60

2.50
2.25

. 50
40

2.00
1.80

......

U8
1.40

34

30
26

1.30
1.20
1.10
1.00
0.90

22
19

16
. 14

0.65
0.60
0.55
0.50
0.45

12
10

Volume
8,000,000

s.
11

5,000,000

3,000,000

1,800,000

~
0

Precision Castparts increased 259% in 115 weeks.

--"
C)

..

0')
Price =
20"eps

Price

Intuitive Surgical-2005

340

1~
Weekly Chart
14

300

13
12
11
10
9.00

260

9g8
7.00

. 160

220
190

140

6.50
6.00
5.50
5.00
4.50
4.00

120
100
80
70

3.50
~ 3.00

60

2.50
2.25

.... 50

2.00
1.80

40

H8

..

1.40
1.30
1.20
1.10
1.00
0.90

34
30
. 26
22
19

8:9g
0.70

16
14

0.65
0.60
0.55

12
Volume
8.000.000
5.000.000
3.000,000
1.800,000

Intuitive Surgical increased 418% in 123 weeks.

~
:2

:2
:2
C'l

."....."
;s:
-<

1111111

.'11,'Trl
I~

1"1
10
9.00

p, cui

/lU.CUIiI

Weekly elm!

;.>OOli
Plcccdcnilor Pricclinc.com was Redman
Industries from January. 1968

9g8
7.00
6.50
6.00
5.50
5.00
~ 4.50
4.00
3.50
3.00
2.50
2.25
2.00
1.80

U8
1.40
1.30
1.20
1.10
1.00
0.90

89g
0.70
0.65
0.60
0.55
0.50
0.45

Priceline.com increased 320% in 85 weeks.

-""

c:::I

00
Price

20'eps
20

:I>

First Solar-200?

Sell: "Railroad tracks" 2 weeks retracing same area, closing in the

same upper part but red volume was increased heavy volume with
no further price progress. Sell next week in 12th week ot advance.

Weekly' Chart

18

Price

400

..,

z
z
z

.... 340

19
14

en
-c
en
....

300

13
12
11

. 260

:s:

220

10
9.00

9g~
7.00

.,,"

.. .

6.50
6.00
5.50
5.00
4.50
4.00

~
..

These comments about increased volume

'
..... 'without further price progress in the current:": .. ;.
. direction tell you the resulls of supply and . .
demand and that the direction is about
....to change. This is valuable to learn and
understand and will give you an advantage
over those unwilling to learn what they're
.
... doing and just listen to others' opinions who .. c.
may also not understand how to use supply,
.. and demand.

.. 190
160
140
120
100
.80

3.50

...... 70

3.00

.. 60

2.50
2.25

2.00
1.80

; .

. 'Very iriiportaiii'subtledefail::prfor

1.30
1.20
1.10
1.00
0.90

50

:;

(ed'

ftTH+

t ,.

~~~~S~~I~;ia~J:~~
~~~~~ fnn~~e~s~%.L
in volume. This is increased volume .. ..
withoul further price progress down,
or major support. This is positive and
most people will never see this clue! '

~ 89g

'Stock closes up
low.
40
good supporting
action compared 34
to fwo prior
. 30
weeks that
closed near lows 26

. :45.%dll

Buy'

week, price is down 3.7% and volume ..--t- ..

. is 45% below average, but this red .. e .. : ..
second week down was a lot bigger :
volume, equal to an average volume'

..... '... Huge quarterly sales

.. growth and EPS growth ..,.
High PIE ratio doesn't
.
....... stop stock's move from
20 to 280

U8
1.40

'.

22
i

...

19
16
Volume
12,000,000

.~ ...

7,000,000
4,000,000
2,000,000

Dee 2003

Mar 2004

Jun 2004

Sep 2004

Dee 2004

Mar 2005

Jun 2005

see

2005

Dee 2005

Mar 2006

Jun 2006

First Solar increased 807% in 47 weeks,

~
~

~
e

Price

Price

20'eps

220

10
9.00

190
160
140

~:~~
6.50
6.00
5.50
5.00
4.50
4.00
3.50

120
100
.... 80
. 70

~ 3.00

... 60
r\
-50
Add off 10-week
: . moving average line
.... 'with volume up
.. 40

2.50
2.25
2.00
1.80

N,

H~
1.40

; ...

!.

34
30

1.30
1.20
1.10
1.00
0.90

26

~9g

16
14

22
19

0.70
0.65
0.60
0.55
0.50
0.45
0.40

12
10

0.35
Volume

16,000,000

8,000,000

.~

4,000,000

.~

2,000,000

~
0

Mosaic increased 265% in 40 weeks.