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Technology Stocks : Global Crossing - GX (formerly GBLX)
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To: TechMkt who wrote (9805)2/2/2001 6:00:21 PM
From: Ally  Read Replies (1) of 15615
 
There's a lot of supply around $26 level. More likely the spike sell off this afternoon are by hedge funds (rather than shorts who tend to be stealth sellers) fearing that the positive sentiment may be reversing. It's healthy that the weak holders are satisfied, otherwise the stock cannot take off.

From a supply/demand study as represented by the stock chart, the stock is undergoing a retracement after having had a nice run. The support level to look for is $19. I doubt the stock will reverse the current uptrend and go below support. However, it is possible since the January run up was not accompanied by strong volume. If Nasdaq breaks below 2,500 then GX would go below $19 and test $14 level. GX is highly correlated with Nasdaq.

From a fundamental point of view, it doesn't appear there'll be a slowdown in revenue or EBITDA growth looking forward this year. I heard an interview by the CEO of Corning, who remarked that the demand for fibre optics is at tne stage of black and white TV. If this is so, it is unlikely that there will be a serious glut of installed fiber. In fact, companies with installed fiber (especially GX with its global span) should be next in line to boom after stocks like JDSU, GLW, the raw suppliers.
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