3SOF

Quote from: traderjbr on December 21, 2006, 02:36:02 PM
David,

If this is what I think Im seeing on the long term chart from the March 06 high,DIET may be setting up for a 3rd wave up.Im thinking the whole move up off the recent Oct. low was a wave 1 and now its consolidating in the 2nd wave.I could be wrong but I'll be watching this one for sure.

Thanks for your analysis traderjbr

I have some friends that are big fans of the Elliot Waves theory, but I could never understand it completely myself. I know the basics, that trends are supposed to be made in 5 waves, that the 3rd wave is supposed to be the longest, but ... I see it more as a description tool than a prediction one.

Because EW is based on the notion that the markets work as natural phenomenons. I believe they're more of a human phenomenon, not subject to rigid mathematic rules. But of course, I'm opened to new and different ideas, just keep them coming

As for DIET, you know I'm actually a bit surprised to see the stock holding up so well? Considering the downgrades, the fact that the stock is about 30% off its lows, it looks like someone is accumulating shares around current levels.

There were news today:

• eDiets.com Announces Seven Members to Comprise Board of Advisors
PR Newswire (Thu 9:27am)

No changes on both websites, www.ediets.com and www.nutrio.com, but they're working behind the scenes.

I'll continue holding DIET, getting a bit more encouraged.

Wow, they finally changed the girls on www.ediets.com. And introduced the new Suzanne Somers weight-loss plan. They're alive

The stock seems to be getting a bit more life too. It would be very nice if it could hold here around the $4 level before the big news hits the wires in January/February, with the relaunch of the meal delivery service.

Waiting and holding DIET.

DIET was up strongly during the session, but couldn't hold those gains by the end of the day. It remains stuck on the $3.80 - $4.33 trading range.

I guess today's rally happened because people ate too much during Christmas and thought they would need a diet ... and as they thought of diet, they thought of buying DIET's shares

www.ediets.com has an article today on its homepage which says:

«Bye Santa Belly!  The holidays bring many things, including very full tummies. This fun workout (no gym required) will help tone down that belly.»

Nothing changed on the fundamentals or the technicals of DIET, I'll continue holding it, waiting for the relaunch of the meal delivery service.

Very low volume of 51 thousand shares on DIET today. Nothing new to think about. Nothing to add to the trading plan of holding the stock.

The same thing as yesterday, nothing new on the technical or fundamental side.

I'll keep holding DIET and waiting for news in early 2007 about the relaunch of the food delivery service and to see how nutrio is going.

We're in 2007 already, so we're expecting news on DIET soon. I've noticed a slight change on www.ediets.com, watch how the "eDiets Express" banner is in a more visible part of the website (and there's more exposure to Suzanne Somers weight-loss plan).

Perhaps the meal delivery service had some improvements already. No changes at www.nutrio.com.

Technically the stock almost touched its ascending 50 days SMA, and remains stuck in the $3.80 - $4.33 range. Nothing else to do but to keep on waiting and holding DIET.

I was just watching TV and just saw a commercial for Ediets.  Suzanne Somers was the spokesperson and she told people that they can go look at her diet plan at Ediets.com and customize it for themselves by answering a series of questions to personalize the diet.  It was interesting that it was called the "Suzanne Somers Weight Loss Plan", I guess they are really going to tie her in.  Anyways, first time I had seen a commercial from ediets!  By the way, no mention of nutrio.com, just Ediets.com

Quote from: trexkerry on January 02, 2007, 06:04:55 PM
I was just watching TV and just saw a commercial for Ediets.  Suzanne Somers was the spokesperson and she told people that they can go look at her diet plan at Ediets.com and customize it for themselves by answering a series of questions to personalize the diet.  It was interesting that it was called the "Suzanne Somers Weight Loss Plan", I guess they are really going to tie her in.  Anyways, first time I had seen a commercial from ediets!  By the way, no mention of nutrio.com, just Ediets.com

Thanks for the info trexkerry

The more I think of long term investing the more I feel I should continue holding DIET. My reasoning is as simple as it can be:

- NTRI was a company more or less the size of DIET a few years ago. Now it is 24 times larger . Why? Because it launched an affordable meal delivery service for people on diet.
- DIET started on the wrong foot with its own food delivery service, but now it is remodeling it and will relaunch it in Q1.

I see a big market opportunity for a small company. In fact, this market is so big it can make the share price grow 20 or 30 fold in a few years.

Do I worry about my current 15% paper loss on DIET?

Absolutely not. I can't focus on the long term and at the same time focus on the short term. If I were to be worried about losing 15% I would probably also sell with a 30% profit if I had one, but no, I'm a long term investor and I firmly believe my investment on DIET is sound.

Great. Although it will be very hard to stick to it when "dark days" come. The last span of dark days occured in the summer of 06. Shall we be mentally prepared for the next stretch of dark days which may happen soon or is already happening?

Here is a little research I did: I first joined 3SOF last May and from last May to last August I strictly followed 3SOF where most picks were done by eLiteG, until he disappeared and for a period 3SOF seemed dying (at least that was how I felt). I compare the actual results to what if I have held on till today (excluding OTCBB stocks which I don't play).

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   Entry   Exit   Return      Today   Return

IMOS   7.91   7.2   -8.98%      6.78   -14.29%
AOB   6   5.2   -13.33%      12.12   102.00%
IHR   6.65   6.22   -6.47%      7.41   11.43%
TWGP   28.26   28.85   2.09%      32.06   13.45%
XING   7.85   7.85   0.00%      13.27   69.04%
AES   18.26   17.37   -4.87%      21.94   20.15%
IRIS   15.02   13.1   -12.78%      12.54   -16.51%
MXWL   21.68   20.45   -5.67%      14.06   -35.15%
AERTA   2.77   3.45   24.55%      2.02   -27.08%
ABG   21.72   20.47   -5.76%      23.64   8.84%
SIRI   4.62   4.3   -6.93%      3.74   -19.05%
ATI   68.25   65   -4.76%      88.62   29.85%
XMSR   14.1   13.2   -6.38%      15.21   7.87%
BRLC   3.05   3.2   4.92%      8.77   187.54%
BBC   14.25   12   -15.79%      5.3   -62.81%
EYE   49.4   49.75   0.71%      35.67   -27.79%
ABI   31.83   31.4   -1.35%      35.84   12.60%
EPIX   4.63   4.05   -12.53%      6.8   46.87%
ALJ   36.3   32.4   -10.74%      24.91   -31.38%
NVEC   16.72   15.21   -9.03%      30.3   81.22%
BRLI   21.5   19.88   -7.53%      22.95   6.74%
STMP   20.21   19.9   -1.53%      15.56   -23.01%
SAM   27.94   28.25   1.11%      36.16   29.42%
BCON   1.4   1.26   -10.00%      0.85   -39.29%
TGC   1.13   1.05   -7.08%      0.7   -38.05%
SVA   2.43   2.08   -14.40%      2.5   2.88%
NGAS   9.19   8.2   -10.77%      6.29   -31.56%
USU   10.22   9.73   -4.79%      12.69   24.17%
TRID   20.53   19.5   -5.02%      18.65   -9.16%
SPAR   15.35   16.25   5.86%      15.36   0.07%
NUHC   12.8   12   -6.25%      10.02   -21.72%
CCJ   39.74   38   -4.38%      39.32   -1.06%

Average         -4.93%         8.01%
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Now this gets interesting, what if we take away the 4 biggest winners AOB, XING,BRLC,NVEC where each of them returned more than 50%?

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   Entry   Exit   Return      Today   Return

IMOS   7.91   7.2   -8.98%      6.78   -14.29%
IHR   6.65   6.22   -6.47%      7.41   11.43%
TWGP   28.26   28.85   2.09%      32.06   13.45%
AES   18.26   17.37   -4.87%      21.94   20.15%
IRIS   15.02   13.1   -12.78%      12.54   -16.51%
MXWL   21.68   20.45   -5.67%      14.06   -35.15%
AERTA   2.77   3.45   24.55%      2.02   -27.08%
ABG   21.72   20.47   -5.76%      23.64   8.84%
SIRI   4.62   4.3   -6.93%      3.74   -19.05%
ATI   68.25   65   -4.76%      88.62   29.85%
XMSR   14.1   13.2   -6.38%      15.21   7.87%
BBC   14.25   12   -15.79%      5.3   -62.81%
EYE   49.4   49.75   0.71%      35.67   -27.79%
ABI   31.83   31.4   -1.35%      35.84   12.60%
EPIX   4.63   4.05   -12.53%      6.8   46.87%
ALJ   36.3   32.4   -10.74%      24.91   -31.38%
BRLI   21.5   19.88   -7.53%      22.95   6.74%
STMP   20.21   19.9   -1.53%      15.56   -23.01%
SAM   27.94   28.25   1.11%      36.16   29.42%
BCON   1.4   1.26   -10.00%      0.85   -39.29%
TGC   1.13   1.05   -7.08%      0.7   -38.05%
SVA   2.43   2.08   -14.40%      2.5   2.88%
NGAS   9.19   8.2   -10.77%      6.29   -31.56%
USU   10.22   9.73   -4.79%      12.69   24.17%
TRID   20.53   19.5   -5.02%      18.65   -9.16%
SPAR   15.35   16.25   5.86%      15.36   0.07%
NUHC   12.8   12   -6.25%      10.02   -21.72%
CCJ   39.74   38   -4.38%      39.32   -1.06%

         -5.02%         -6.56%
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What I learned is:

Once you have done extensive research on a certain stock (although eLiteG approached more from TA's angle, I'd believe he must have considered FA too), be very reluctant to let it go. The fate of a stock portfolio is almost entirely decided by a handful of big winners.

One thing bothers me is that the market currently heavily favors large caps over small caps, yet big money has to be made from small caps. The goal of 3SOF being it is, most candidates have to come from small even micro cap companies. Have you given any thought on that?

Quote from: David Randolph on January 03, 2007, 05:48:01 PM

Do I worry about my current 15% paper loss on DIET?

Absolutely not. I can't focus on the long term and at the same time focus on the short term. If I were to be worried about losing 15% I would probably also sell with a 30% profit if I had one, but no, I'm a long term investor and I firmly believe my investment on DIET is sound.

That's a great study realcoolhead, thanks a lot !

I believe that since eliteG used technical analysis exclusively, it was very hard for him to hold a stock for a somewhat long time period. Because technical analysis is too volatile, especially if the TA is focused on short term indicators, like candlesticks, volume, and short term moving averages.

I believe the basic and most important premise of technical analysis is "the trend is your friend". The medium/long term trend, that is.

QuoteOnce you have done extensive research on a certain stock (although eLiteG approached more from TA's angle, I'd believe he must have considered FA too), be very reluctant to let it go. The fate of a stock portfolio is almost entirely decided by a handful of big winners.

I absolutely agree.

QuoteOne thing bothers me is that the market currently heavily favors large caps over small caps, yet big money has to be made from small caps. The goal of 3SOF being it is, most candidates have to come from small even micro cap companies. Have you given any thought on that?

Yes, I've been thinking about it, but the more I study the fundamentals, the more I see that the large cap vs small cap choice is irrelevant. That's another form of short term market timing that is bound to fail over the long term. The controversy "should I go with large or small caps?" shouldn't exist in a long term successful investment strategy.

Why? Because ultimately fundamentals always prevail, nevermind the size of the company. If sales and profits grow, so will the share price. If they shrink, the stock will go down. I've been seeing this relationship every time I study long term fundamentals and technicals in combination.

I can understand why in 1923 Livermore had to be a bull and just buy stocks in a bull market and be a bear and just sell stocks in a bear market. There was little stock specific information back then, and the money just followed the big waves of the general market. Even a few years ago, it would be impossible for me to perform fundamental analysis as fast as I do now. It would be almost impossible, say, in 1995, for a Portuguese like me to perform fundamental analysis on US stocks. Now, with the internet, information is easily available for everybody that wants to study it, it is much more fair.

I think this will lead to an even more efficient and stock specific market. A bad stock will go down even if we are in a bull market. A good stock will go up even if there's a massive bear market. Of course, multiples may expand or contract, but in the end, fundamental trends will persist and the share price will follow.

What I mean by all this is that money will become more and more informed as time goes by, so don't be afraid that your very attractive growth stock, just because it is a small company, won't get the highlights: it will.

As for DIET, this is the second time I'm taking a beating on it, and of course I don't like it.  But I think you and everybody here understand my play, this company should grow immensely as NTRI did, if management gets its act together. The market opportunity is just too appealing to be missed.

Management said on the latest conference call they will relaunch its meal delivery service and provide details of the new service in Q1 2007. I want to hold the stock as I wait for the news, and if I like them, hold the stock for the long term.

But I can understand my timing was poor, not just because I'm losing, but also because I should have waited for the catalyst, not jump in months ahead of it. A lesson for the future, I'll try to keep that in mind when a similar situation occurs (I think I'm doing that with GGC, for example).

I'll continue holding DIET.

Nice technical rebound from the neckline on the chart below. I would welcome DIET coming back inside the $3.80-$4.33 channel.

DIET has a new management team on the job just since October 2006:

• eDiets.com(R) Appoints Steve Rattner President
PR Newswire (Tue, Oct 10)

And they said on the Q3 conference call that they would merge www.ediets.com and www.nutrio.com websites, creating a brand new website, selling services to both individuals and businesses.

They are also restructuring the food delivery service (they already changed the service's name from Fresh Cuisine to eDiets Express) and will relaunch it in Q1 2007.

I'm expecting these developments to increase long term shareholder value, because without a doubt the market opportunity exists and it is huge.

I'll continue holding DIET.

david,i seem to recall you've mentioned in the past that averaging down is a loser's game. Even with that in mind, i bought some more at 3.40 on  fri. if it has value at 4.20,3.40 seems to be a screaming buy. as always,MR.market will the final word. soxguy

For anyone interested in buying, DIET presents a good risk/reward ratio here with horizontal and 61.8% fib level support around the 3.40 level.  Besides David's neckline support, we have an ascending trendline that could also act as support.

Maybe it might be a good idea and try and recoup the big loss on DIET by buying low especially if this trend reverses. Thing is not sure if this would be investing good money after bad.  Seeing it down again makes me nervous.

call me nuts,but i bought some more at 3.42. saw one of their commercials on vh1 over the weekend. eventually this can work into the collective consciousness and months from now it will look like a no brainer. we'll see. soxguy