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Technology Stocks : Check Point Software (CHKP) -- Ignore unavailable to you. Want to Upgrade?

To: Getcher who wrote (1970)	4/10/1998 12:59:00 PM
From: Danny Chan	Read Replies (1) \| Respond to of 7150

Getcher: The technical similarity that I was looking between CHKPF and PMCS is for the longer term. I double checked the short-term for PMCS and found similar conclusion as yours. But I'm more cautious. Here are my comments: On 2-day MACD chart, yesterday looks extremely similar to 12/11/96 when MACD broke to upside about 3 month ago and stayed flat. The stochastic curve also topped. However, TA analysis has to be combined with fundamentals to make better prediction. 1. The fundamental of the company improved significantly compare to 96. PMCS was still in product transition at the time and now completed. Management provided good visibility to 98 revenue and earning during the last conference call, sequential revenue increase and strong design win trend (see past PMCS thread posts for details). 2. The earning is just a few days away and the street is expecting good results. I expect PMCS to beat estimate for the current quarter by 2 cents. 3. PMCS is a better-recognized stock compare to 96 as evidenced by its daily trading volume and up-down distribution. Look at their margin numbers and ROE. I expect buying support to be strong as it pulls back. My conclusion: It will have a near-term pull back, but I doubt it will be more than 10-12%. I think 38-39 should be the bottom for the next few days. As a long-term player on PMCS, I would not sell the stock. Instead, I wrote covered calls and I plan to buy them back if PMCS reaches my pull back target or broke to upside again, or about 45 1/2.