Duane asks:
Have you developed a strategy to take advantage of some of the
coming carnage?
First of all, I agree there is more downside left. We are entering
a period of cross currents. On the positive side (if long) there is
the January effect and year end money being put to work. Negative?
Downward earnings revisions due to SEA, especially in the Tech
Sector. In addition, the DOW is still historically high. The
200-Day Moving Average for the DOW now stands at 7500. I use this
indicator to help me define whether we are in a bull or bear market
as far as investors (as opposed to traders) are concerned. The MA
was smashed in October but held nicely in November. If this MA
holds (as we decline) I will decide what to purchase at that time.
One possible scenario to watch for would be for the DOW to decline
to 7600 but not to the MA. This would complete an inverse Head and
Shoulders at the 7600 level we reached last August, very bullish.
Regarding LSI, the next few years look bright to me, but the stock
(like many Techs) has only achieved distress, not capitulation.
Since it does derive 25% of its Revenues and Operating Profits
from SEA (see Steven's post)
Message 2939386
the stock should suffer further downward revisions. In summary, my
stock selection will be determined by the next few months, want
the DOW on my side, am in no hurry. As I said, Ka$h is King.
o~~~ O |
