A quick post as we head into a new week. A 1300 pt drop in the DOW in two weeks has opened the eyes of most investors and reinfoces exactly what I've been saying all along. I will go out on a limb once again when telling you that many of the stocks that are now breaking down are only in their INFANCY! Look at the stocks that I have been talking about lately: JBL, LEH, BA, CSCO, QCOM, MSFT, and let me add let me add SNE (brand new to the list). Their price breaks have only just begun. Their landscape will look much different when this qtr. is over. When I look at prices from that reference point I see nothing but pressure going forward. That is why when I hear investors talking about snap back rallies in the avgs, especially the ones that are based off of pictures of brokers with agony on their faces, all the talk of magazine covers or all the endless discussions of capitulation, once again I see a market that is managing investor psychology while it does its dirty work. Perhaps this time the contrary indicator IS the contrary indicator.
Anyway, the way things have lined up this week I am expecting more of a tech wreck to catch up with the damage in the DOW. Just caught a piece on CNBC about revelations that the Banks were helping ENRON hide monies. Just look at LEH finally broken down from that h&S I have been talking about. JPM freefalling. Watch the tech's that I mentioned above. The CSCO, MSFT, AMZN, JBL, and chip stock's in general - unrelenting pressure. Oh yes I almost forgot, IMCL and TYC, two stocks that many would say sent invitations out to this bear party will once again face the music - "do or die." Their prices could go even lower yet.
The fact that this market could shave 1300 hundred pts off the DOW while many of these stocks have barely budged should rock all of us.
Good trading.
SO |
