I believe the low of 21 was generated before the general public was able to act upon the bad news. Market makers orchestrated the fulfillment of stop-loss orders and market orders to buy and sell that existed before that point.
At any rate. . . I waited for a bounce and got out at about 23 1/2, for a little profit. Just in case the "cockroach theory" comes into play, I don't want to own any shares of IDEC until it is plain that a firm bottom has been established.
The analyst who gave such a rosy estimate of 12-month price target for IDEC (around 42) before he went to ML, seems to have lowered that price target to about 32 now that ML is finally giving a recommendation on Idec. I don't know what "accumulate" means to others, but to me it means stand back and wait for it to stop falling, then buy just a little, looking for a bottom, but ready to accept more price decline and buy more even lower, still fishing for a bottom.
In '96 the bottom that a few lucky bottom-fishers "accumulated" at was around 14. This year, it slid down to just below 16 (April). So my first question is, will it find its next bottom above or below 16?
Any opinions, after today's close, from technicians, point and figure chartists, fundamentalists. . . anyone else?
My opinion is: The range it is in today is a price equilibrium range, considering prices back to late '95. If there is more panic selling, it could dip as low as 13 to find really solid support to ricochet away from. I believe it best, for now, to simply avoid the earthquake zone and wait 'til the dust has settled from any possible aftershocks.
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