Carl, I thought NT was oversold. It fell from $8.50 to $4.85 in less than 30 days and I was willing to bet that it was excessively sold off because of recent (and temporary, IMO) scandal on top of market jitters, economy/job worries, attack in Spain, NASDAQ valuation, etc.
And while I don't claim to be an expert on TA, I agreed with someone who I think is. From Dabum on Yahoo thread:
There's always the possibility that NT will fall below support. I had been waiting for NT to come down to my support level, shown on the chart. I thoughts the odds of a bounce off that support level were good because of the huge amount of selling we had already witnessed. I thought we saw a selling climax yesterday so, I was willing to take a position when I saw the price bouncing off support on good volume. With the amount of volume we saw yesterday, it was clear to me that institutions were buying as well.
Additional comments on the chart.
stockcharts.com[h,a]daclyiay[pf][vc60][iut!lh1 4,3!la12,26,9][J27562431,Y]&listNum=1
Your time frame determines what's a good price. I'm willing to hold my current position for 6 months or more. I want to see it trade a couple of more days before I commit to a trading position.
Many times I have made handy profits by entering when the crowds are fleeing, and other times I wished I did. <g>
I'm looking at NT as a short (3 to 9 month) hold. There's a lot NOT TO LIKE about its business (low margins, too many analysts following it, extreme competition, lawyers now piling on, etc.) but I look at the drop in the chart and say, that's too much. And hey, they made money for the first time last year in 5 years!
research.businessweek.com
It may fall again, but I was comforted to hear Jim Cramer pumping it the last two days on his radio show, saying he has been doing "aggressive buying." Which tells me he'll continue to pump it through his emails and on air because of his rules to hold stocks at least a month.
Resist the Crowd
Wednesday March 17, 3:26 pm ET
By James J. Cramer, RealMoney Columnist
Where were these buyers Monday? Where was the buyer who just paid $83.93 for Phelps Dodge (NYSE:PD - News) when the stock was at $78? Where are those sellers of Nortel (NYSE:NT - News) at $4.75 today? The stock has moved up 80 cents on no new news whatsoever.
Other snips:
In their latest few quarters, their continuing operations have been performing very well. These announcements and management changes really raise a spotlight of uncertainty on a company that's trading below $10, and there are a lot of skeptics to begin with, so the short sellers are having a field day. But from a product standpoint, we think these guys are in the best shape of the old-line telecom companies, and we don't think it derails their deal with Verizon (VZ), so we think it's a buying opportunity.
yahoo.smartmoney.com
Yahoo thread:
by: chilledogg68
Long-Term Sentiment: Strong Buy 03/18/04 02:29 am
Msg: 460943 of 460943
After listening to the Q&A session of the Merril Conference I am stunned! This restatement is really a non-issue! The CTO said that he didn't forsee the reinstatement having any material impact. He said things may just be adjusted from qtr to qtr. In a nutshell, The NT before the reinstatement is the same one as today, just $3 cheaper. Also, I got the impression that the CFO was put on leave because he was incompentent. The appointment of the new acting CFO was to ensure proper leadership during the review.
I urge everyone to listen the the Q&A portion of the webcast. You will feel alot better about NT. Go to Nortel's homepage for more info.
Also, why haven't these comments been made public? They would put alot of people at ease and the stock price would increase dramatically. That's our negitive media for you, kick a guy when he is down, but don't help him back up!
I believe what the CTO is saying is the truth, with all the potential lawsuits I doubt that he would lie. |
