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Strategies & Market Trends : Stock Attack -- A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: donald sew who wrote (26865)	8/6/2000 10:37:39 AM
From: donald sew	Respond to of 42787

In the past I had mentioned a LARGE TRADING RANGE for the SPX of about 1520-1340, which I am still holding to. For the SHORTER-TERM I suspect that the SPX could be testing the lower portion of that range, so Im shorter/mid-term bearish. I would turn really bearish if 1340 on the SPX was broken to the downside, otherwise Im holding onto the TRADING RANGE TREND for the longer-term. Take a look at the following chart on the SPX, and you will note that since early JUNE the SPX is developing a BROADENING PATTERN. Broadening patterns are commonly more negative than positive. So my CAUTION FLAG still flies for the shorter/mid-term. siliconinvestor.com

To: donald sew who wrote (26865)	8/6/2000 2:17:29 PM
From: dli	Read Replies (1) \| Respond to of 42787

Donald, excellent thoughts on the semiconductor sector. It is interesting to note that those "high-end semis" that Franz mentioned (BRCM, PMCS, AMCC) have remained rather unaffected by the recent selloff in the semiconductor sector despite being among those that have run up the most this year and sporting astronomical PE ratios. Personally, I think that this is mainly due to their affiliation with the fiber optics sector which is currently in favor on the street. As soon as fears about the sustainability of accelerating growth in the fiber optics sector will surface those stocks are sure to get whacked hard. A good example is the recent trashing of the specialized wireless semis (RFMD, ANAD, TQNT etc.) after people started worrying about potentially slowing growth in handset sales. IMO the notion of those high-end semis not being subject to the cyclical nature of the semiconductor industry is another one of those new paradigm illusions. Once it becomse apparent that bandwidth needs won't grow exponentially forever this sector will become just as cyclical as the rest of the semis. As for the SOX, it is dominated by old line semis and therefore does not properly reflect the whole industry. Dave

To: donald sew who wrote (26865)	8/6/2000 3:43:12 PM
From: James Strauss	Respond to of 42787

Don: Good SOX analysis... It has already retraced about 33% of its gains from the 182 level... bigcharts.com A 50% retracement would put it in the 772 area... bigcharts.com Williams %R and Stochastics say we are closer to a bottom than a top... Perhaps the new highs by the utility average could put a floor under that retracement as investors begin to look beyond the next FED meeting... Jim

To: donald sew who wrote (26865)	8/6/2000 4:39:23 PM
From: AllansAlias	Read Replies (1) \| Respond to of 42787

donald, I do not understand your SOX analysis. How can you draw a "trendline" between the 95 (571) and 97 (405) peaks? This was an old downtrend line that was broken Dec/98. --Allan

To: donald sew who wrote (26865)	8/6/2000 10:02:06 PM
From: Alan Hume	Respond to of 42787

Don, thanks for you interesting post. Yes the semis are cyclic, the cycle usually takes about 4 years peak to peak. Bt having said that, I am reffering to the true bread and butter semis (ADI ATML NS TXN VSHY etc) and not the new breed of speciality product builders who are still in the process of developing their respective market places. The reason that the true semis are cyclic is that capacity and yield are acheived by A) increasing the wafer size b) by decreasing the structure To demonstrate this, if a semi manufacturer upgrades his production by going from 8 to 10 inch wafers, he effectively gets 56% more devices on the wafer, but the number of processes remains the same By decreasing the structure from 25 tu 18 mu,as is very popular right now, a manufacturer gets about 93% more devices on the same wafer. So you see, an upgrade is very "digital" in effect. It is in reality too dramatic, and is detrimental to the market When, delivery dates start getting longer and prices get higher, the manufacturers upgrade their fabs (good for AMAT and KLIC etc) then much new capacity comes on stream at much the same time, supply vastly exceeds demand, prices plummet and you can buy TXN NS MOT and co at dumped levels This is just the general rule. Of course there are many special cases and exceptions. Right now, the fab upgrade season is drawing to an end, and hence AMAT and co are descending Good luck Alan