A classic example of the success enjoyed by many CANSLIM.net readers usually starts when an investor reads a CANSLIM.net report and buys a featured stock before it has risen above the pivot point by greater than 5%.  After a stock breaks out above its pivot point, there is only a +5% window that investors have to purchase the stock under the proper guidelines. Once a stock rises above the "maximum buy price" the risk of a shake out balloons, meaning that even a normal retracement in the stock might force you to employ the 7-8% loss cutting rule.  Much can be told by the stock's daily action in the weeks and months that follow a breakout. Typically, a light volume and orderly pullback suggests that the bulls remain in control.  However, high volume pullbacks that violate support paint a totally different picture.

Dolby Laboratories Inc.  (DLB +$2.37 or +4.82% to $51.52) vaulted to a new fresh all-time high with a considerable gain on above average volume. A stock that jumps into new high territory on higher volume displays healthy signs of institutional sponsorship. Large institutional investors do their best to hide their operations from the rest of the Street, but these activities cannot be hidden from astute chart readers. Normally, gains marked by above average volume are the direct result of healthy institutional accumulation, not based on the marginal influence of retail investors. DLB has been a growing favorite among the institutional crowd for well over the past year. The number of top-ranked funds that own an interest has steadily grown from 74 in the quarter ending December '06 to 102 in the quarter ending Sept '07.  This type of healthy accumulation helps to satisfy the I criteria, and the bullish action suggests that higher prices are more likely to follow.