*AV*--my trigger limit have been hit in a great number of stocks so far. Even though there seems to be a slight recovery, as we speak, I have been "triggered" out of numerous positions and am formulating some re-entry strategies. Some of the noteworthy stocks now have re-entries of 10-20% below the exit point.
Patrick-FWIW, when RMBS opened up on Monday in the 97s, I raised the target to 93 and was triggered out. As much as I like RMBS, I am going to stay on the sidelines for just a bit longer, looking for a lower re-entry.
As far as the Japanese economy getting worse, keep in mind that this might be a good thing. This will teach them a valuable lesson and prevent future occurrences. With that said, their problems are going to be a boon for the US IC producers as well as the European and Taiwanese producers. The hit to the equipment sector may sting for awhile and it might push out my timetable for the recovery, but it might be well worth it. The Taiwan manufacturers are leaders in technology implementation due to their foundry position within the industry. I am looking to them, the Koreans (who have swallowed the bitter pill) and the European community to pick up some of the slack.
I also believe the protracted downturn is going to create a rush to the new equipment and technology that will cause huge backlogs down the road, coupled with long leadtimes. What I am trying to say is that another feast-famine cycle may occur but this time the Japan issue might be overshadowed by the long line of other customers that need to expand or refurbish their existing production facilities. Backlogs and lead times are at historic lows. A mad rush to new equipment will extend both out to unacceptable levels that could actually stifle the industry. Again, the perils of a Feast-Famine situation. If Japan does lag this recovery, the offset might be healthier in the long run. Japan at the back of the line has many positive connotations to it.
Finally, Japan is capable of "turning on a dime" so today's IC problem can easily be eradicated with the stroke of a government pen, as has been done before. I certainly would love to see Japan lag the industry for awhile, in order to regain parity across the industry.
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When we first sent out the newsletter 6 weeks ago, we started riding a nice tech wave up. We had a few lower limits triggered along the way with most of them correctly placed. Of the incorrectly placed limits, only a few, like PRIA were a huge mistake. Most of the other mistakes are now looking like they were correct decisions or mistakes that I can now rectify with minimal cost penalties. The recent drop that triggered some of the limits that were in place created cash to allow re-entry into some stocks. Those WFR shares that triggered (not all share were sold off unfortunately) are now being bought back at a ~20% discount to the selling price.
Anyway, the "other side" of the strategy has come into play over the past 3 trading sessions and is allowing us to perserve profits, protect profits, and provide re-entry into the same stocks with close to 10-15% more shares or to diversify into other stocks.
"I Love it when a plan comes together". <GG>
Andrew
BTW-for the record and for those still interested, I pushed out the final price increase time frame from 11/14 to 12/15 and was asked to extend to the end of the year. So, anything postmarked by 12/31 will be accepted, just here. |
