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Technology Stocks : Semi Equipment Analysis

SOXX 312.18

-0.2%

Dec 9 4:00 PM EST

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To: Kirk © who wrote (7928)	1/1/2003 6:38:03 PM
From: Return to Sender	of 95541

Only MU has a lower RSI than INTC of the SOX components. MU looks like a broken stock to me. So if it is it not likely to bounce any time soon. I would agree that LRCX is a better way to play the upside when the SOX is moving higher than INTC. I think this is both due to a larger short interest, 5% as opposed to 1%, as well as a higher beta. But I wonder if both INTC and the SOX don't have a lot more downside in store. Oh sure the first session of the new year (maybe more) may bring buyers as investors hope for a second half recovery in 2003 but on a technical basis I think we will get better buying opportunities. Check the chart on the SOX and you will find that the RSI is way off bottom levels seen during the last six months: stockcharts.com[h,a]daclyyay[pb50,200!d20,2!c20!c10!c200][vc60][iUb14!Uk14!La12,26,9!Ld20]&pref=G The RSI of the SOX is at 39.9 now. It has been below that several times this past year. I am looking for a relative strength of 30. It was there several times last year. The times that would have corresponded with market bottoms is when the BPNDX was below 20. BPNDX closed at 59 on Tuesday. I'm waiting for another verifiable bottom before putting much money to work in 2003. We'll be able to predict that bottom when we see the VIX over 50 again, BPNDX below 20 and the RSI of the SOX below 30. RtS

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