Carl, I think we are still in consolidation here, and as long as we do not breach the $5 area, we'll be OK. The market in general is following the scenario the turnips have laid out, with of course strange exceptions in the NZ, but I think the NAZ is going to join the downside "Party". Note that in classical terms, we really have a bear market in motion, the DOW not holding the late January lows of 10729, the transports being massacred and the Fed's having gone through four to five (depending how your count) tightening steps, and apparently, they are not done. We'll feel it first in the financials and the cyclicals, in housing and then late in the game the technology will come down. Don't forget RMBS, I just got back in yesterday at $84, and it sure looks as if it wants to take out that supply here.
I also think that AMZN is going to cause the internet darlings to be downsized to more rational valuations, and this sector together with the SOX and networkers have been fueling the party. When people talk publicly about CSCO reaching a market valuation of $1 trillion, I start to see the exit signs all over the place.
Yet, there is spreading into the Russell 400, which is a good sign that one can find jewels here and there. I like HAUP on a retrenchment to the mid to low $50' (this one I suggested a year ago at $8), ULBI on a retrenchment to $13 or so (it just blew up today for no apparent reason), VLNC on a retrenchment to the low 30' and few others like ONT, XIRC and CCRD (right here). I also am warming back up to our old friend VECO, but am waiting for a test of the low $50' ($51 to $52) before getting back in. It still is a value stock compared to its peers, IMHO.
Oh, don't forget RMBS, it looks as if it wants to take out that supply here, I just got back in yesterday at $84, and I think there is a good chance that it might still be available over the next two weeks in the $86 area.
Zeev |
