Stephen, JRI, don't know what time-frames you're thinking about trading, but a lot of holders of BRCM and JNPR may see any rally (even a little one, if they're lucky some furious short-squeezing affair) as a last chance to get the heck out. Furthermore, though the stocks (and several others of the same type) may very well bounce, and, when they bounce, bounce in the traditional momo-stock manner, it looks to me like they've got at least equal chances to break on through to the other side.
The weekly charts in particular are horrible on both, and there's no more hope on the dailies - mirror images of the unstoppable rises that first gave these stocks their reputations and still seem to give them force on up-moves. JNPR's at critical support, and next lower support looks to be in the mid-70s - a new 52-wk low. BRCM's getting close to a level it's already reached twice in the last couple of months - already a 52-wk low. If either goes much lower, then the selling may hardly even have started on them.
I'm not sure that support/resistance/countertrend plays make a lot of sense with stocks like these at times like these, but, as you know, I'm fairly conservative (for my own work, I tend to use s/r more for exit-targets and confirmation of other set-ups than for entry-targets in isolation). Though I'm obviously pretty bearish on both of them (hardly makes me a contrarian), I don't at all exclude the possibility that they'll both be $100 stocks again before too long. It looks a bit more likely that they'll try on some $50-60 suits first, but I don't play that kind of prediction game for anything but fun. |
