To: the Chief who wrote (48113 ) 3/1/2001 12:47:59 AM From: CIMA Read Replies (2) | Respond to of 62348 JDS a play according to this: To OTC Journal Members: Market Comment The market was poised to rebound today in anticipation of Alan Greenspan's testimony on Capital Hill. This week's Consumer Sentiment numbers fell off a cliff and had all of Wall Street convinced that Greenspan would finally admit a full blown recession was around the corner. It was expected the FED Chairman would act aggressively to cut interest rates before week's end, sparking a rally in stocks. Wall Street could not have been more wrong. In his opening remarks Mr. Greenspan made it clear he was not convinced the economy was slowing as rapidly as stock prices reflect. He spoke at length about corporate management's use of technology to respond nearly instantaneously to changing market conditions. He stated that manufacturing could react nearly in real time, leaving less concern about inventory build ups and allowing the modern corporation to rebound from an economic slow down much more quickly than at any time in history. When asked about slowing consumer demand as a result of the end of the Wealth Effect caused by the dramatic rise in stocks, Mr. Greenspan quipped: "As a colleague of mine once said, Wall Street has successfully predicted five of the last two recessions." The NASDAQ responded with another bloody day closing at 2151.83, the lowest level since 1998. We are now 59% below the all time high. At 62% we match the worst bear market in modern history. This happened during the 70's when the Prime Interest rate was 19%. If Mr. Greenspan is right corporate performance will not be as bad as Wall Street would have us believe. If there is evidence of positive corporate performance stocks should begin to behave a little better. Trading Alerts Traders on Wall Street now believe there are no events which could propel stocks higher. Experience tells us the market generally does the opposite of what everyone expects. We are not market technicians, but we know some really good ones. They believe there is a high probability of a short term relief rally. We have decided to bring you two of their ideas as trading alerts. Our editors are going to act on these ideas for their own accounts in the morning, so we will be in there right along with you. One important warning: A gap down in the morning would be ideal if you like these ideas. If the market gaps higher, wait for a pullback before taking any positions. JDS Uniphase (NASDAQ: JDSU) JDSU is one of the leading names in Fiber Optics. This stock is highly volatile and has fallen off a cliff in the last 10 trading days. The stock was nearly $56 on February 1st, and today closed at $26 3/4. The company has recently announced lay offs and ramped down projections, leading us to believe all the bad news is already built into the stock. Stochastics are depicted in the middle chart. Note every time the line gets to 0, the stock rebounds. It started up from the 0 mark towards the end of the trading day, leaving us to believe a rebound may be imminent if the market rebounds. $25 would be an ideal entry point if the market gaps down tomorrow morning. Look for a 3 to 4 point rebound. Keep a tight stop loss- don't risk more than 1 or 2 points on this stock. Nokia Corporation (NYSE: NOK) Almost everyone agrees that Nokia is the class act of the wireless hand set manufacturers. The stock has gone straight down from the first of the year, but has finally leveled off over the last five trading days in a very poor market. On this stock the MACD indicator appears to be headed into the green, suggesting the stock is about to rebound. As with JDSU, the Stochastics are close to 0, another bullish indicator. The ideal entry point for NOK would be between $21 and $22. Look for the stock to trade into the $25 range. This stock will not be as volatile as JDSU, but a 1 to 2 point stop loss should also be used. Both of these short term trading ideas are predicated on our belief that the NASDAQ is due for a rebound. A gap down in the morning should create low risk entry points for both of these stocks, but a rally must ensue for these ideas to make you money. If the NASDAQ keeps dropping get out. Use a stop loss and stay disciplined. -------------------------------------------------------------------------------- The OTC Journal is a proud partner of the SwingWire.com Online Investment Community. A next generation Online Analyst Exchange providing Members the ability to search, review, track and monitor some of the Internet's best Online CAs (CyberAnalysts). 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