OT TXN:
This chart gives me confidence:
stockcharts.com[h,a]dahlnyay[de][pb50!b200!f][vc60]
We've had 4 rallies in the stock in 2001. Each one got closer to the 200D moving average, and the last one got above it, briefly. That indicates the downward momentum is waning. The next rally, IMO, takes us above the 200DMA, and keeps us there.
In addition, management has given clear indications they think their business has bottomed, and the numbers get better from here on out. Within telecom equip, wireless is about the only area that is growing (maybe metro networks also). TI is well positioned there, better positioned than INTC for the next semi upcycle.
I'm considering a long-TXN/short-JNPR combo, to hedge market risk. I'm fairly sure TXN's business will revive a lot earlier than JNPR's will. I'll reshort (using put LEAPS again) JNPR, at 25 and 27.5.
I figure the September panic selling set a bottom for TXN, and for the chips/semiequips in general. That bottom will hold, IMO, until: 1) the Fed starts raising rapidly, late 2002 is the earliest we need to worry about this, or 2) all the signals are false, and chip sales/margins haven't bottomed yet. I don't know why TXN is falling, but I'm going to take advantage on it, buy in increments all the way down (I've got lots of cash and haven't even started using any margin). Below 20, I'll buy LEAPs, 04C30 or 04C35. |
