Hi Keith,
Oversold? Probably, but......
I don't see this as the bottom. We need much larger volumes on the NAZ with capitulation on the part of many who are still long. Once the NAZ crosses 2400, it will be time to start considering some prudent limit buy orders on issues like BRCM. Fortunately, the fundamental story is still in place. A CableLabs green light on DOCSIS 1.2 could be a trigger for a run back up the flagpole.
I advise, keep your powder dry. Better opportunities are coming.
I'm not sure I agree with your assessment that fear is the prevailing emotion. Skepticism is possibly a better description of the present mood of Mr. Market. Fear is what we saw on a day like last Aug. 31 when the Dow tanked 531 points. Today was more or less a snooze in comparison.
In the summer meltdown of '97, fears about Asian devaluations drove the market lower. Last year it was LTCM, the Ruskies and the consequent lock up of the bond markets. This year all we have are some vague and amorphous concerns about China, Argentina and Y2K, among others. There is no really big crisis in the consciousness of traders. I think what we have here with Mr. Market is a hypocondriacal worrywart with a long memory. And profits that are melting away unless he takes some $$$ of the table. Today's action is of the "To Be Continued Category", in my recently humbled opinion.
Best, Ray |
