<<I believe capitulation will occur this week>>
Speaking for the entire market, I agree too. In fact,
we may see that tomorrow as margin calls are already
on the way:)
But for us to move up from here, people must see the
following:
1:) The earning starts to come in and shows that although
economy is slowing down, the growth in the future
is still strong, strong in the sense of historical
comparision.
I see YHOO's earning of next week to be vital. People
are going to look hard at their Q4 forecast (Q3
weakness is being priced into stock as I type here).
If YHOO gives out a dim outlook for the next quarter
or two, NASDAQ is doomed and 3000 level will be broken.
2:) Energy price must at least stablize, if not heading
lower. Wall street has been ignoring the rising
oil price for a long time until recent weeks. Dont
forget it's much more difficult to battle against
this beast, than say, against Asia crisis. The
pressure is not going to be relieved whether Fed raise
or drop interest.
3:) Fed must stop talking about the possibility of raising
interest. I can't believe they did not put a netural
standing policy today (not that it makes any difference
for its next meeting).
One must be crazy by not admitting that a "soft"
landing has indeed occurred Any more brake on this
horse wagon, we are in real danger of going into
recession.
People already start to talk about semi cycle peaking,
so semi is done. Internet is dumped like there is
no tomorrow, and we start to see even YHOO's rev
growth may be impacted for real. Telephone companies
are in trouble, so all those fiber darling and equiepment
makers may head into trouble in 2001. PC growth is
diminishing, and you have INTC and DELL at the new
52 week low, so on and so forth.
Most of the above are just speculations at this point.
But if all the tech world really start to cut the budget
and spending, the stock market is going to crash more,
housing market will be sluggish, people will spend less,
all the above is just the beginning of the end.
Not to paint a miserable picture, but I dont see any
reason for Fed to raise the rate in the near future.
Having said all of these, I will, however, step in and
buy the upcoming sell-off this week. It is not an investment
if there is no risk involved.
Danny |
