Nice futures market. Bulls are either fast asleep, comatose or dead. Dancing bears are high on euphoria and some are still too greedy to cover or turn. These are hardly the makings of a quick recovery. So it may be best to back off your views of the markets to 30, 60 or 1000 minutes. Once again, yesterdays winners may still be tomorrows losers.
There will be a "New Breed of Tech Winners" for 2001-2002. But perhaps the most significant difference is that there will be a new breed of Tech Traders as well. Seasoned veterans. . . with sharper eyes. . . a quicker hand . . . not as gullable as previous versions. . . who bought and held . . .buying dips and selling peaks . . holding margin overnight . . and have since bit the dust. No, this new breed of winning traders are either specialists or experts in their own style of trading. . .or are flexible Hybrid traders. . . moving freely with the trends. . . between long or short position trades, long or short swing trades and long or short daytrades. . . . with a side of options as a hedge.
As a trader, you must be SMARTER to trade these markets than you needed to be when you could throw darts at the financial page. If you are going to be a trader, you must be willing to invest your time learning the proper and effective methods. There is no longer a burn factor. . . .where you just start trading and the first hundred grand you lose, you chalk up to education. Those days are long gone.
So we'll be focusing discussion more on strategy and less on picks from here on out. . . .[at least until the trends make another major change.] . . . this is an extension of what we started over a year ago. . . We are simply taking it to the next level. Of course the boards on Insighters are set-up along these lines. . . speaking of which. . .OT> I have been out since Monday morning, due to illness and family emergency. I apologize for not getting back to anyone during that period. Everyone is fine now. <OT
And I am beginning to once again feel bullish on techs. When I look up and see Lucent at $6 bucks, due to short-seller rumors. . . .Nokia, WCOM, AMD, CIEN, GLW, CSCO, ORCL, PALM, YHOO, ARBA, JNPR, AMCC, etc., etc. all looking like they have been hit by a Lennox Lewis combination. . . .and have that dazed "what am I doing down here" look about them. And that is why so few gamblers, uh, er. . .investors are willing to pony up a bet on them. . . . for fear that when these techs begin to stand up again, Roy Jones, Jr. will begin pummeling them back into the ground.
And that is about where we are right now. That is why a day like this with the futures up as sharply as they are, no longer excites the crowds. They are not easily impressed, because so few have sustained a comeback. But while the champs are dancing around the ring with their tired arms thrown in the air, some techs are slowly regaining their composure, conserving their energy and planning a strategy to get themselves back in the fight. And I haven't seen that spirit in a long long time.
I am also beginning to see some swing trade opportunities develop . . . buying the very best tech companies on days when the markets get ugly and oversold and selling them on days when we see a morning pop. Yahoo was fairly easy to spot. For that matter, many stocks with strong earnings and growth that have been pulverized are worth considering for our deeper DD standard. . . . [nope! nuthin' comes easy anymore.]
That elusive 3 or 4 day sustained rally has become somewhat of a myth. . . .and without such, the bears have no reason to stop applying pressure. The Fed [or fear of them] no longer moves these markets. I am noticing that there are some smaller brokerage houses beginning to dip their toes into the tech markets and calling bottoms. This is probably due to the confidence which comes from less downside risk here as opposed to several months ago. But until something happens to change this condition considerably. . . get comfortable in the muck.
Earnings will be out in droves next week. . . .so there is plenty of room for more bad news. However, it will be extremely interesting to watch how the markets take the news. How this market responds to good news and how it responds to bad news will reveal much about its current condition. I suspect that we will begin shrugging off much of the bad news and start reacting to the good news. And that would be significant. So stay tuned!
And best wishes to all. . .
Rande Is |
