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FWIW, here's my take on the recent action with DDIM and the near term prospects. On the surface, DDIM has performed well since testing the 22 area in mid June and late July. The recent move from 22 to 30 was accompanied with a thrust thru the 50 MA, which although still declining slightly, will now become the significant support level. (currently 25-26.) A close below 25 in here would be a short-term negative and be cause for some profit taking. The most likely price action in here, notwithstanding a surprise to the upside, would be for the stock to challenge the 30-32 resistance level. This may still take some time to surpass and close above 33. Volume is still important in here as it will take significant upside volume to get us thru this 30-32 resistance level. At any rate, look for large volume to accomplish this. If we go thru on light volume, I would consider the move questionable and consider some profit taking in anticipation of a short term pullback. On the downside, as I said the 50 MA should now support any pullback. If we go thru 25 on heavy volume then you must consider lightening up your position. I expect the 50 MA to curl up within 1-2 weeks and set the stage for a significant breakout above 33. So far, if you have been long, you have to be pleased with the recent price action in contrast to the market in general. This week marked the largest point decline in history for the DOW and therefore cause for concern. I look for the DOW to rally as early as Monday and that rally should give us a sign as to its future direction i.e. volume, breadth characteristics on the rally. The Y2K group as a whole has held up well and that is also important for future price advances. |
