TA and "winnowing out":
siliconinvestor.com
For the entire slide down, from last year's highs, the stock has been unable to sustain any move over the 50 day moving average. A few times, the stock poked its head slightly above the line for a few days, and then the downtrend resumed. That's a resistance line, where all rallies have failed.
However, we are seeing an interesting thing, in the last few days. The 50DMA is currently at around 11. In the last few days, we've gone well above the 50DMA, then came down and bounced there yesterday, and we're up today. That is, instead of testing it from below, we have just tested it from above, and passed the test. So, it looks like that moving average may (just may) be becoming a support area, and we are at the beginning of an uptrend, where the stock can be expected to find support every time it hits the 50DMA. If we bounce there again, in the next few days/weeks, I will be further encouraged.
Anyway, that encouraging chart pattern, plus the encouraging noises from management, plus the fact that we are near the end of the year (I'd like any cap gains to be in 2002), means I am cancelling all sell orders for NTAP. If I didn't already have all I want (at prices from 11 to 6), I'd be buying at 11-11.5. Since I am now sitting on cash again, I am thinking about buying some more 2004s.
We are starting to see a "winnowing out" among tech stocks. When the Bull Market resumes, some former darlings of Mr. Market will be welcomed back with kisses and hugs. But some are going to be left out in the cold. The winners will be the ones that move first and strongest, the ones who have held up the best in the downturn, the ones whose management is now saying they are seeing a bottoming in business conditions, the ones who have stopped going down on bad news, the ones who have the financial strength to take advantage of this downturn, to dominate their sector on the rebound.
NTAP to da MOOOOOOOOOONNNNNN!!!!!!!!!! (eventually) |
