ST trading:
The chart pattern for AMAT actually looks very bullish. We have a pattern of higher lows: 34 in 12/00, 36 in April, and 38 in July. Other than the brief dip to 38 in mid-July, the stock bounced at 42, many times, in July and August. The stock has gone 8 months without setting a new low, forming a solid bottoming pattern. The Nas is now just 10% above its lows for this bear market (so far, 1620 in April), while AMAT is 24% above its previous lows for this bear market. This indicates that the Nas would probably have to go well below 1620, before AMAT takes out 34.
For a ST trade, going long at 42, and selling at 50 or even 58, is reasonable. I would not short AMAT, even at 58. I would not hold any short position in any semiequip, into the BTB report, as a continuing uptick in bookings could abruptly send all the semi-equips soaring. |
