Larry,
Thanks. Basically, I don't usually day trade (anymore), but I saw here an opportunity that doesn't walk by every day. Dell's going to split tomorrow, and there are a lot of people who want to own Dell. For whatever reason, it seems a lot of smaller investors won't buy a $160 stock, but they'll buy an $80 stock. I'm generally a believer in the "split phenomenon", where stocks that split are bid up. Mainly because I think that once this split observation was made, it became a self-fulfilling prophecy.
Of course, Dell's already been running. But the Dataquest report is coming out on Monday, and is expected to show big market share gains for Dell and Compaq, and Compaq is also splitting on Monday. Add this to an exuberant Greenspan and a crazy market, and it sure seems like a good time to make a bet.
That said, I think Dell's bound to have a SHARP correction one of these days. I personally think it's gotten a little ahead of itself. For now, though, I doubt that such a correction would be long lived. Too many people just dying to get in to this stock who'll buy on weakness.
I think today is a very bad day to go short, personally. After the madness tomorrow AM, who knows? But I think the Monday report will keep the stock up. Once the report comes out, I have no guesses. |
