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Strategies & Market Trends : MDA - Market Direction Analysis

SPY 672.07

-1.7%

Nov 13 4:00 PM EST

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To: g_m10 who wrote (10531)	4/11/1999 11:42:00 AM
From: j.o.	Read Replies (1) of 99985

I would disagree, g m10. It is not NEWS perhaps that CPQ is not the powerhouse it once was, but this warning does not bode well for this business. Did Mikey DELL talk about how strong his PC sales would be in the analysts meeting? No - he talked about everything but (as I understand it). There is still a lot of "box-maker" euphoria out there, as we can see in the P/E's. The NEWS is that the euphoria is badly misplaced. I think that CPQ just underwent a sideways consolidation with 30 (or thereabouts) being the key support (as per your chart: iqc.com Now we will break hard to the downside for another big downmove (toward 19/20), and I think that Dell will break back below its 50-day moving average support around the 42 level: clearstation.com This is the level that created the massive DELL short squeeze when it was taken out in the last rally. Now with the shorts out of the market, both of these stocks will fall hard. I think that we already saw the happy-dip-buyers...and they are all very long DELL now. Perhaps there are more dip buyers waiting in the wings, but I think that the bears will carry this round. That's my read on it, anyway. j.o.

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