I have to agree with you somewhat GST. If you guys are going to short stocks it's best to short stuff like BRCD BRCM, and other extreme high PE stocks. Fiber Optics stocks as well as people are going to learn the hard way tomorrow.
But some stocks are resisting the bad news. INTC was practically unchanged on the day. NVLS was up nice today, so was TXN. AMAT was only down a little. Look at CPQ and GTW, they were even up. Trashed stocks like T were up and WCOM was only down negligibly. Lots of financials held up well today considering. So price does matter, and I think stocks like INTC and SUNW have monumental bad news priced into them.
I have not changed my bullish stance, even though the Fed didn't cooperate today. The Fed meeting was the catalyst I was looking for. He could have cut rates and that would have been an immediate positive catalyst. As it stands now, his not cutting rates is the catalyst which is going to cause some capitulation this week. Sometimes you have to go lower to flush everyone out before you can go higher. But in the process of going lower things get so negative and you pick up so many shorts along the way that it's ok even if you started buying a day or two early, because the snapback is so violent.
Like I said, people like me who started buying today can sometimes look foolish at first, but then no one looks like a hero at the bottom. They look like a total dope for going long. I have NO PROBLEM buying more call options tomorrow. It just won't be on ridiculously priced fiber and storage stocks like CIEN and BRCD. It will be on stocks that have mucho bad news priced into them and have PE's around 20-30.
INTC, SUNW, AMAT, CSCO under 40, etc. I might even have to look again at some YHOO calls now that it's REALLY getting ugly and shorts are piling on. |
