>>On the daily charts, the NASDAQ's nine-day exponential moving average line crossed the 18-day exponential moving average and threatens to cross the 27-day exponential moving average. This last occurred in early October, during the previous market slide. Lackluster volume has been bothering traders because market bottoms are made during high-trading days. This has yet to occur, suggesting the tech-stock correction has not ended. The primary support level stands at 2273. The key resistance level is 2448. A weekly close below the primary support level might create a further panic in the tech stock sector. A weekly close above 2448 would rejuvenate the NASDAQ and set in motion a rally for a historic high.<<
I can't argue with this, and I agree with a good deal of it.
However, and not to be disrespectful to whomever follows the technical or fundamental indicators . . . I have to say - I really don't care!
I have said before, and I keep saying it again . . . a good investor identifies which stocks they want to own, and then waits for a buying opportunity. If you go back a few posts, I said that Bid.Com under $5 was a screaming buy, and once again when I went away for my holiday and I came back to find that the stock was still under $6, I stated that I bought some more because I felt that it was still very cheap compared to the risk reward it offered - so I bought some more.
If, for whatever reason, this stock drops 50% of its current share price it then will just go to a value of $3.20. But I believe that once the European office is opened, or, if it gets much closer to a Nasdaq listing, then we will really see it start to take off.
I anticipate that if Bid.Com is rewarded with anywhere near the IPO performance that the comparative auction or Business to Business stocks have achieved (with a less diversified business model I might add), then a pop up of 200 to 700% in its share value is not out of the question. Not bad risk reward I'd say. The longer term prospects look even more promising.
So in response to the possibility that the tech and Internet market may still correct more, I have to say that "sure it is a real possibility". But in my opinion, what a fabulous buying opportunity for those who know which stocks we want to buy. We will be able to get them for a much better price than what they are currently selling for.
Once again, I have to re-state that I agree wholeheartedly with the rational that the Motley Fools espouse. They say, don't worry about valuations for the good companies, because in ten years from now, the price you paid for them will be considered very very cheap. Home Depot, Microsoft, Dell etc. were all considered to be expensive ten years ago - and boy oh boy do I wish I had bought some then.
So in summary, Yup, the market may continue to correct! But just pick your spots, buy on the dips, and hold on for the long term.
Oh, by the way, I am just as excited about the near term future for Bid.Com as I am for its long term one.
If anyone thinks I'm just Crazy (heehee) then let's discuss this in 10 years from now.
Talk to you soon.
Crazy Canuk
P.S. If you don't trust me, then read up on Sir John Templeton's (of the Templeton Growth Fund) buying strategy which he calls "Pessimistic Opportunism". A.K.A. Buy when everyone else is selling. |
