You may recall last Wednesday, shares of Yahoo! (YHOO) briefly dropped below their 200-day MA. They bounced of that average like a rubber ball. Well, yesterday, was Amazon's (AMZN) turn to do that. Shares of the online retailer dropped to $97 1/8. That was below the 200-day MA of $97 1/2. Once again, that average acted as support and the stock roared back to close at $112 1/8. Amazon should have found its support here. However, prices will not rise in a straight line. They will be volatile, but with an upward bias. We still believe those blue chip Internet stocks such as AOL, Yahoo!, Amazon.com and CMGI are good companies to have a stake in. On Tuesday, shares of Amazon.com were hammered by a negative article in Barrons'. Every few months, Barrons' runs an article that trashes a company. In 1996 and 1997, it ran several articles (similar to that on Amazon.com) on America Online stating that the stock was prime for a fall. Well, shares of AOL have increased by more than 5-fold since then. In a year or two, we will probably look back at the Barrons' article and wonder at the buying opportunity we missed. Please remember one thing. Stocks that increase in value by 5-fold in 2 years are bound to be volatile and lose a large percentage of their value in a short period of time. However, they typically come back in a strong fashion. The stocks mentioned above may continue to lose more this week, but it always turns out that the best time to buy solid companies is when everyone else is selling them!STOCKWINNERS
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