Bateman, NN did well today, meeting 27 - 28 resistance well, and holding above it hopefully to establish a base. Next step is resistance in the 28 - 32 range were it sat for a long time, 4/96 to
4/97. These folks will have a tendency to sell as soon as NN reaches their buy levels ( 28 -32 ).What we don't know however is the exact extent of this overhead supply that NN has to go through before going to 33. How many of these folks actually sold when NN went from 69 to 17? As I remember, that fall was big, heavy and bloody; 69 to 17. Also it happened during selling time,Dec 97, so that selling for tax loss purposes might have been heavier than expected.What I am getting at is that more people might have gotten out of NN on it's way down than we suspect; so that the overhead supply may not be that big.
A test of that supply will come in the next week/weeks as NN tries to move higher: the speed of the rise will tell us about overhead supply and potential sellers.
Going forwards however I think the picture is great. Look at Oracle: the news of it's demise were also premature. Back to 31 from 18.
NN and TM are coming out of this bloodbath with a new understanding
of what a stock massacre looks like when market punishes you for poor execution.So that perhaps a new emphasis will be placed at cutting overhead, don't spend money foolishly,( UB Networks ) etc, etc.Perhaps devote closer attention to running the Titanic off iceberg paths, GG. I am heartened by the lead time they have in ATM.You can see that their No 1 competitor CSCO does not have the technological know how to make new breakthroughs in ATM ; they grow by buying their way into discoveries ( Stratacom ); they warned of that in their 10Q. Instead with NN I think you have the knowledge, vision and expertise. LU is just beginning in ATMs; it will be a long time coming; Merrill ( in spite of their buy recommen on LU )has it growing at 18% with a 98, 99 PE >37: expensive.
Bought some NN at 28 7/16 this pm.
TA
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