Tucker, on CNBC an analyst from Openheimer yesterday was interviewed.
He was interviewed from their trading floor. His comment, "We'll probably retest the 3200 Nasdaq level again."
Why?
"We need to ring out the 'excesses' in the market that came about since the Nasdaq's last rally".
they then did a take of Prudential's analyst giving a slightly more positive take on the same 'excessive' issue.
although paraphrased, allow me to ask some simple questions...how does one define 'excess' relative to the market? at what point did Oppenheimer, et al, decide that this or that stock was justifiably excessive, or the market in general was 'excessive' given the earnings environment? don't you take these type of collective phrases given by fellow analysts in the business as bordering on manipulation? or do you believe, as some do, that collective market manipulation is practically impossible?
when several large firms come to the near simultaneous conclusion that 'excess in the market needs to be wrung out', how does one compare the 'excess' in Dell vs. the excess in Cisco or SUNW? the best answer to this last question is simply - they don't determine such. the leading stocks are sold in blocks, or groups. many stocks are first equally tossed per group then evaluated for strength thereafter. a decline, in and of itself, invents the story. it's weak because... shareholders then determine that Dell is a poor current investment based on reasonable decline; regardless of future prospects. one act feeds on another...and so on |
