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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: Zeev Hed who wrote (6644)	11/19/2001 1:18:43 PM
From: Adam Smith	Read Replies (2) \| Respond to of 99280

FWIW Notes from Soundview Tech Conf. which was held last week. Technology Focus The only thing technology investors seem to agree on lately is that there will be a pullback. Thee are so many investors still asking skeptical questions that we cannot help but believe that 1) most institutional portfolios remain under-exposed to technology and 2) any pullback between now and the end of the year will be notably brief. If there is a pullback, we expect that software and storage stocks will be more vulnerable than chip and chip equipment stocks. IT vendor confidence upticked a lot after they got the roll-ups showing that business improved from September to October. We are not convinced that the November roll-ups will bolster the confidence of most vendors to that same extent - especially vendors in the storage and software arenas. We continue to find the signs of improvement in the device sector to be far more convincing. Technical Analysis Market Comments: Stocks had another nice week, with most of the major averages, and groups, ending higher. Technology and cyclical issues led the advance, while the energy patch suffered from a sharp drop in the price of crude oil. From a technical perspective, it's a "good news, bad news" story for stocks right now. Specifically, it is quite positive that the major averages have made it back through and are holding above their April lows. Those areas could easily have turned stocks away, and getting through them goes far in confirming the "island reversal" on the NASDAQ. That being said, stocks have become quite overbought in their battle to overcome these areas of resistance. Up volume and momentum are both diverging as well, which makes entering here (as we approach another area of resistance) a rather dicey proposition. The bottom line is that, while it appears as though the bottom is behind us, risk management suggests that "buying dips" is probably wiser than chasing stocks here. The tone of the next dip will also be critical in helping us gauge whether we have seen a bottom, or the bottom. Movers and Shakers: In this type of market environment it is best to focus on strength and on stocks that are leading the way