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Technology Stocks : Texas Instruments - Good buy now or should we wait? -- Ignore unavailable to you. Want to Upgrade?

To: Hayduke who wrote (5512)	3/1/2001 3:18:36 PM
From: Jacob Snyder	Respond to of 6180

Bought some calls, 2003 30s at 10.5 today. In the last few days, the stock has stopped going down, even though there has been continuing bad news about telecom and chips, and the Nasdaq continues to tank. A bottom? Maybe just a short-term bottom, a little bounce to resistance at 36, and then we go on to new lows? At this price, TXN meets all my investment criteria, except the last one (TA showing a firm bottom). You are very right about not buying the dips, and not buying just because it is a quality name, and not buying just because the stock is down a lot off the bubble peak valuations. I am not sure if this is a longterm holding. I may sell if we set new lows. I may sell if we bump up to 36 and stall. Until this bear market is over, I will buy very cautiously, and sell easily. And I think the odds are that we have at least one more false rally like the January rally, before THE bottom is reached. There are some encouraging signs that, although consumer sentiment is very bad, people continue to buy. Cars and housing are holding up better than expected. However, this is NOT true for chips, and everything with chips in them. The chip sector is still seeing slowing demand, inventories not coming down, demand (still) less than expected. So I'm betting that we have at least one more earnings season like the last, with EPS and sales forecasts ratcheted down yet again. However, if the overall economy is doing well, it can't be more than 1 or 2 quarters before the chip industry follows. Chips are in so many things now, that I think we are going to see an alignment of the chip cycle with the overall economic cycle. So, the time to "back up the truck" on techs may be when there are good signs that the overall economy has bottomed, but while every tech exec is still saying, "zero visibility." And that time may be soon. Or maybe not till the end of 2001. Since I don't really know, I'll buy in increments, and sell my higher-cost stocks on rallies.