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Politics : Idea Of The Day

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To: IQBAL LATIF who wrote (15944)	12/25/1997 4:28:00 AM
From: halfscot	Read Replies (1) of 50167

IQBAL: Thanx for the Forbes article/link. This more or less confirms what we've been seeing in the charts for several months now. As many TA'ers will testify, I think, the technical breakdown(s) of a chart/sector usually foreshadow the inevitable that is confirmed once the bad news is released. In other words the market (insiders?) usually knows what's coming before it's confirmed with pre-announcements, downgrades, etc. It might be wise right now to look at making money with shorts/puts in sectors that've been beaten down but still have some laggards to follow. Some examples: From the Forbes article: Server and Enterprise Software- BAANF-heavy asian exposure but still 168 pe and hasn't fallen nearly as much as its contemporaries. Networking-CSCO and LU-CSCO will tumble even if there's a hint of a problem-it's the only networker left holding rich valuations. LU is less of a pure play but has a very high trailing pe and looks weak technically and is not immune to the asian flu. Software-and who can overlook MSFT. Has held up remarkably well but looks to be rolling over. Any further bad news and look out below! We've been seeing the same happening in the oil/drilling sector. As all the stocks in the sector have fallen against screams of protest as to their strong fundamentals, etc. It turns out there may be some there there after all. Some bad news is finally leaking out to confirm the sector's breaking down. I think this sector is shaping up to be a great long condidate again but we have to see some strength first before jumping back in. Just my 2 cents worth and IMO only. Be interested to know other's opinions and any ideas as to stocks waiting to take the same path as their peers. halfscot

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