Ork, don't look for rationality, you must look for liquidity, when large pension funds (they have more than $3 Trillions under management) change their allocations, the money flows first into the leaders in their segments. Eventually, valuation will play a role, but that is a long term process, that may take few bull/bears cycles over the next few years. I would not be surprised to see INTC bouncing against $50/share late next year. Will it be"worth" that much? Yes, if that is what the market says it is worth (g). What trailing PE will it be? Between 60 to 80. Yet, the $32 to $32.5 area is a triple top (April, June and August ), thus a real tough test here, a breakout above $32.5 will have all technicians running over each other to jump on board, on the other hand, if it does not breakout in the next few days, I think the following decline will be sharp and furious. Interesting times...
Zeev |
