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Technology Stocks : Cohu, Inc. (COHU)

COHU 23.73

+1.1%

Dec 30 3:59 PM EST

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To: robert b furman who wrote (3019)	6/12/2002 4:58:16 AM
From: robert b furman	Read Replies (3) of 7827

June 12, This is day 39 from the recent high of 30.65 on April 17. Yesterday's close @ 18.75 was .05 below the 99 dip worst case scenario and it took 2 days longer to get there. On the Wednesdays before option expiration often times market activity is very volatile and zig zaggy. Recent price erosion has accelerated - which induces a fear of future declines.That's a good bottom going in sign. This is where my third leg of buying kicks in on 25% purchasing power.A bottom will go in and only luck will put you on it - it's time to wait for the double bottom close to bottom retest and be looking for that followthru day after a reversal.Best if it happens 4-11 days after the reversal.I'm watching Intc and counting 7-8 days from the reversal it will get us right there and within a point of the bottom and all kinds of divergences in TSC,Macd and BOP. First was at 200 day ma @ 21.75 - no institutional support has really come in here.Volume is light.Price reductions appear to be the result of poor liquidity and small blocks of retail selling creating an oversupply. Second was below 20.ish Third at expected worst case price. TC2000 shows all sectors and market in general to be very oversold. Past bottoms came in on light volume rounded a bottom and quietly traded more to the side than v bounces.This bottom will be subtle and over well before you know it just happened - that's right toto no horn at the bottom. I'm not going crazy here I'm watching my margin - any margin after a long decline is uncomfortable.I've not used any cash reserves - may need them to pay down margin. I still don't think this dip signals anything other than what past dips were.Just a confidence gap on wether this recovery is for real. I think it is. Earnings and the forward visions will confirm this. We just need to go a little longer - deal with some anemic sideways trading and let the earnings and some new leadership show up. As a fine tuner for putting in the bottom - I still think Intel is the General out in the battlefield to watch. Sept 21st,2001 low was 18.96.On the next 2 trade days the 24 & 25 it popped up nicely - then it traded down for 6 days -close to that low 19.08 ( 8 trade days later) (just slowly floated down to 19.08 on 10/03).Note how earnings came in on the month after the quarter (October) and a nice rally took it to 36ish. That overall Rally has failed and we now sweat out a retest. A similar failed rally also occurred in 1998.Intel bottomed on June 3 :17.53,17.67, 16.42, 16.48, (ohlc). Retested 7 days later and rallied only to fail 3 months later - this low came with a 1.02 of the June low 17.73 19.69,17.44,19.19 (ohlc). Intel proceeded to lead the market up from that September low as most stocks retested later - in early October (that earnings time again) - and they weren't necessrily great earnings - rather the guidance was good i.e. backlogs are growing - high tech manufacturing processes are sold out and in high demand. Let's face it - this industry requires itself to reinvent a need for the new.If we're relying on just replacement cycle needs - we're in deep do do. We will see with backlogs growing and demand for the new manufacturing techniques that eqipment makers will once again LEAD the Recovery.It leads because to utilize them requires forward thinking and an anticipatory posture. This market with its good economic recovery statistics will once again have an earnings recovery.The backlog alone will give us the forward guidance needed. The terror,geopolitical forces and corporate corruption are all todays news noise where before it was something else "earth shattering" like the Thailand currency and the 3rd world debt crisis impacting South Americas: YADA YADA YADA. Watch the leaders - wait for a double bottom,look for O'neils follow thru day and believe the world has one great global wealth driver - Integrated circuits and the digital revolution. It is alive and well. It will again resurface to be a growth force.We got ahead of ourselves - we've just about paid the full price and we are about to go higher again. JMHO Brian Kerecz has summed it up very well in his recent recap of "Missed Great News" by the media (they are fixated by the negative reporting of fear-I wish some one would stick a sock in Maria's mouth).That cleans it up as good as I can.<VBG>:http://www.siliconinvestor.com/readmsg.aspx?msgid=17584665 I'm going to buy some used cars for the next 2 days.I'm hoping prices there drop as much as Cohu has.gg At least it will be a market where at least there are buyers.I wonder why they don't pipe in CNBC there? hehe Hold with confidence and buy after the market proves itself to have bottomed - we're very close - may well be there today so the prove part will come in 4-11 trading days. Gee wiz - that's close to July earnings and Intel bottomed on June 3 1998. Deja Vu anyone?? Bob

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