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Technology Stocks : Simple Technology - STEC

STEC 1.590

+65.6%

Dec 23 3:59 PM EST

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To: Rudy who started this subject	3/15/2002 2:14:15 AM
From: Rudy	of 36

What now? Congrats to traders who took some profits timely yesterday. Long term investors holding it such as myself, you're in good shape as well. Let's look at our trend for what to do now. 1. 50DMA is over 200DMA and both are sloping up. 2. Uptrend is zig zagging within a channel started in October '01. Lower boundary of this channel is at 6.5 upper is at 8 (give and take 10cents - I need to establish my charting service again :) I am trying to interpret net based charts here.) 3. March 12 STEC blew its channel's upper boundary. This happened before in January as well. Now, I like to see shrinking volume (hoping today we let all bad blood out) and sideways or slight down action towards the inside of channel. In uptrend channels the boundaries once broken do not function as support or resistance. Therefore level 8 (edge of channel line) will not be supportive. Further correction is very possible. Continued pullback towards 7-7.5 is within range. Repeating again, I like to see volume shrink towards daily average or lower. This was a negative signal day. That is price falling with volume rising. Meaningful + or - days were (going back to Jan 31): March 14 - March 11 + March 7 + March 4 + Feb 27 - Feb 13 + Feb 11 + Feb 7 - Feb 5 - Feb 1 + Jan 31 + So usually 2-3 + days are always followed by 1-2 - days. + are in majority. As a rule of thumb, to call a trend reversal one needs to see 6 + or - days in a row. What we have here is a tug-of-war with more pull towards up than down. After all is said, what now? For traders: HOLD Trend is up, buy or add if and when it pulls towards 7-7.5. Hold now. You decide when to sell. I say next time it hits the upper edge of channel (note:by time channel rises). For investors: HOLD Trend is up. Buy between 7-7.5. Hold until signs of a trend reversal appear. Use sell stops to protect your investment. Remember we have not even checked a 50DMA!!! let alone 200DMA. Long term investors riding big waves usually watch the 200DMA. RSI and Slow Stochastics was very oversold and they are getting a well deserved rest. Slight pullback and sideways action will correct these indicators back to neutral levels to support the next leg up. Along with these I think we also have chart resistance at 8. So IMO, this thing will hang around 7.75-8.25 for a while until its trendlines catches up with it. Let's wait and see. Good luck all. Rudy

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