In this market environment, it is easy to get caught with blinders on and continue to believe the indexes will go lower and fundamentals will get worse, and that every rally will be sold.
It's almost the same menatality that longs had a year ago, myself included, that stocks could only go higher and every pullback would be bought.
Right now I don't see the bottom but a year ago, I never saw the top too. It's foolish to keep predicting doom and gloom because history and has proven that the stock market does not go down forever, contrary to what some would have you believe.
JDSU as 17 is a lot better buy than it was at 117. CSCO at 15 is damn cheap comapred to CSCO at 75. I can tell you with 100% certainty that both JDSU and CSCO will not go down more than 17 pts and 15 pts, respectively. But by reading some opinions, you get the impression that these stocks will be trading below zero shortly and you won't even be able to give them away.
I can't argue with the bear case right now because I've had my head handed to me on a platter. The bears have been right and if they want to keep reminding me how stupid it was to be buying JDSU at $100, then go for it.
Just as greedy at the bulls were at Naz 5000, the bears are exhibiting the same behavior down here. You can be sure that at Naz 2500, Naz 3500, and Naz 4500, bears will continue to short because of how easy money was made on the short side the past 6 months.
Humans are greedy by nature. They never have enough, and when they do, they always want more. You know the saying, "What goes around, come around", "Bulls get fat, Bears get fat, Hogs get slaughtered", yada yada yada. I could go on and on but it's pointless. You can't argue with a bear today the same way you could not argue with a bull 13 months ago.
But this cycle goes in circles and eventually we will have another boom cycle. One day JDSU will make a new all-time high ($153), maybe it will take 2 years, maybe it will take 10 years, who knows, but my bet is that it will get there.
All I know is that I've got a lot less to lose holding JDSU at $17 then when I had JDSU at $100. From a short's standpoint, these are now defined profit investments. You will not make more than $17 per share shorting JDSU and more than likely, much less.
Good luck everyone. |
