<<Do you think that MSFT will fell seriously? According to the chart, MSFT is turning downward. I am afraid that MSFT will drop to ~120 in next few day, even if it may bounce tomorrow. >>
I was thinking the same thing at the gym tonight, and this is my conclusion:
MSFT at its current mid-100 level is a lumbering giant. It seems to lag other tech stocks in its up/down movements. Its price is too high to trade actively, so I think a lot of the crazy day traders are keeping only a distant eye on it. I also think it's been remarkably stable in the last few months. In October it reached the 120s, but (correct me if I'm wrong) wasn't it already around there at that time?
So we have a downward range of a little under 15% from its current levels, and remarkable resilience. That compares favorably to most blue chips out there, and very well compared to most tech stocks (except AAPL, which rose on Blue Monday, convincing me that it's held by a bunch of very weird people (like me) who "Think Different").
Thus, I think a lot of cool-headed, extremely long-term investors have MSFT as their very innermost core holdings.
Conclusion:
1. Don't short MSFT -- not enough downward potential.
2. Don't bother trading MSFT short-term, either. Unless you have tremendous self-control, this is what will happen if you sell tomorrow, assuming we're right about the overall market drop:
a. You sell at 140.
b. It starts lumbering downward while everyone else is crashing.
c. Maybe it reaches 130, while everyone's bouncing back. You can't help it, so you buy because it looks like the worst is over.
d. It keeps lumbering down, slowly and agonizingly, to 125, and you're kicking yourself for getting in too soon, and you do something stupid like sell.
e. It lumbers back to 145.
So what happened? You wasted a lot of time, lost sleep, and spent commissions to make only (140-130)/140 = 7% more than you would have if you'd done nothing.
Me, I think I did the wrong thing by already doing step 2(a). So I'll be the guinea pig.
But to answer your question, it might fall to mid-120s, but probably really slowly. My opinion only, as you know. |
