OT: SOX, ARMHY comments:
Although 300 is a ST support line for the SOX, my bias is still down, as the market seems to be ignoring good news, but responding to bad news. Also, I think the market is pricing in a stronger rebound in profits in 2003 than is likely to happen. I see both capital spending by businesses, and consumer spending, as flat or down in 2003 compared to 2002. With little likelyhood of a strong rebound in either type of spending, there is little likelyhood of a strong rebound in profits. I see 2003 as yet another year of "right-sizing" by businesses. I expect by mid-2003, we'll be discussing the odds of a second-half recovery (2H04, that is). So, I feel comfortable shorting the rallies.
For ARMHY, the 2.5-2.55 area is an important support line, which we broke today. I bought a lot in the 2.5-2.6 area. If we get back above 2.5, I think we retest intermediate-term highs at 3.9 in the next couple of months. If 2.5 doesn't hold, I think we retest recent intermediate-term lows at 1.87. In either case, my highest-cost shares cost 2.8, and I think short-term volatility will let me get out at at least break-even on them, no matter where the market goes. I will play the 1.87-3.9 range, trying to accumulate a longer-term position at a low cost, and make some trading profits. |
