To: Moonglow who wrote (6763 ) 4/24/1998 12:42:00 AM From: Spytrdr Read Replies (3) | Respond to
I disagree. In order to build a good base in a stock, all you need is good fundamentals and good momentum in their products and sector. If the company has good fundamentals and keeps improving them by new contracts, increase in revenues, deals, etc, then that's a solid base/foundation to build upon. "If you build it, they will come". And they are coming to DGIV! If this stock was a bubble, it would have exploded long ago. All this technical analysis talk about buyers and sellers and hands coming in and hands coming out and highs and lows and intra-day stock graphs doesn't make much sense if you don't take into account the fundamentals, what the company is actually DOING to achieve all this. The rest is worthless rear-view mirror analysis. This stock apprecciated 1800 % in a couple of months? So what? Does that mean there's got to be some sort of correction? No! (actually there were already two corrections if you look at the chart). A company can quickly go to sky high valuations if the fundamentals improve at the same speed thanks to good management. For example, take a look at the DELL 100-day chart, you can do it here in S.I., with the great charts we have. You will see that DELL stock apprecciated a whopping 18914 % since 1990!!! Yes, that's 18914 %!! Imagine that you were visionary enough to buy into Dell in 1990 and -more importantly- kept the stock for 8 years.
Well, things like these do happen!
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Regarding your observations on how the market works....well of COURSE
you're right! In order to build a good base in a stock, you must have
new hands coming in at higher prices in order to build a stronger base.
And the only way those new hands can keep coming in is to buy from
someone who sells. If no one ever sold, the stock price would rise, but
the base wouldn't be as strong and would be more apt to crumble quickly.
