Hi Sampat,
Technically it looked like a breakout - Sortof.
However back in Dec of 1999,Cohu met similar resistance @ 31-32:
12/27 @31.75 on volume of 279,700
12/28 @31.38 on volume of 204,500
12/30 @30.75 on volume of 114,300
12/31 @31.00 on volume of 42,900
these where looking good like new high breakouts - then in the first week of January 01- the predictable happened - a final shakeout.Designed to shake out the last nervous holders.Cohu dipped to:
01/05 @27.38 on volume of 238,800
01/06 @27.56 on volume of only 61,400
That was the key - a drop from almost 32 to a low 27 and there were no sellers.Just strong holders.
Sneaky signs of manipulation there.I'll bet somebody sold several thousand shares at the market and the price cascaded down from 31 to 28 and they bought up the discounted stock until there wasn't anymore.
The rest you can guess:
Another week of sideways trading in the 28's
01/12 - High 29.50 low 28.30 last 28.50 on vol of 72800
01/13 - High 29.88 low 28.75 last 29.75 on vol of 100800
01/14 - High 35.38 low 29.88 last 35.00 on vol of 1,817,400
I've had that post it note on my computer ever since !ALMOST 2 MIllion shares and two days before it traded 72,400 shares.
What a breakout in volume - probably did the average days volume in the first half hour.
The volume will be the key.It will be obvious and of course the price will be meteoric.But catch the wave of volume - buy @ the market or undoubtedly watch the ask leapfrog over your order - frustrating I'm sure.
Know your desired position and buy it at the market and don't chase it.But get it and ride it.
The entire 2000 consolidation before the breakout took 30 trading days .Price ranged fro 28 to 31 and back to test 27 and then blew up on a major breakout.
In 1997 the entire consolidation took about 33 days and failed to breakout.It then bottomed out at 12 in Oct of 98 - Darn near killed me.ergh
Cohu had a big day of volume at that top also 817,400 shares.It happened on 10/03/97 - but price never blew off.It reached the past high(28.75) and sold off @ 28.88.
The difference is subtle but that extra million shares drove Cohu 4 points higher in 2000 compared to the failed rally in 97.
I guess the overall market was a big factor there as well.In 02 we're coming off a big bear market in 97 they had already had a nice rally that was a little long in the tooth.
I think we'll most likely have a low volume test of wills - sneak up to 31 again and wait for that explosion of price to be our big "BUY" signal.
One awesome point to note we're 32 days into this consolidation.It should be happening right now!
The overall market looks good - that is buying me more patience.
Earnings come out on 04/24/02 @ 2:00 Pacific .One very nice feature of this market is good earnings are being rewarded with Breakaway gaps up : INTC, RFMD, TXN.
Cohu had a nice rise in backlog last quarter - IF orders kept flowing in, they have the capability to produce and ramp up quickly - that's an old dance for them.Keep in mind they'll be doing it with 50% of the previous workforce so earnings leverage could be very poweful.
If this market holds together - we could see that price and volume spike result from the earnings announcement.
Gamblers will buy on light volume weakness prior to the earnings.gg
Surething traders will wait to see 31 + on million share plus day.
Any way you cut it - these are extremely exciting times.I can't seem to leave my computer - I'm glued to it.ggg
Praying for a breakout.
Bob |
