To: marketbrief.com who wrote (21931 ) 6/6/1999 2:03:00 PM From: - Read Replies (1) | Respond to
Yes, that's a very good YHOO chart analysis posted on intelligent investor.com. Here is my way of looking at it, which complements that analysis with some "why" analysis, but is in fundamental agreement: I would just say "their is nothing fundamentally wrong with YHOO, one of the top three internet sector stocks, a very profitable enterprise (albeit, with a whopper of a P/E). The issue became 'oversold' recently, after first becoming overheated in late March, running April 5-6 almost 60 points in a pair of "blow-off days" to $244 on April 6, then reversing and falling sharply for most of April-May to as low as $120 1/2 on May 26(very significantly, along with the rest of the internet sector) due to [take your pick: big sell orders being worked during the Reg 144 insider selling window, hedging (selling of derivatives to insiders requiring establishment of puts, short sales to hedge), lack of adeqate internet sector news in a nervous market environment, interest rate fears, incessant Bear stories that the sector will crash, short-selling raids, etc]. Now, with that selling likely out of the way (although that is still a speculation), as the stock approaches earnings with great news reportedly in store (as usual), it has been showing signs (for about a week) that it is reversing upwards around, along with the rest of the sector. The nearest/strongest overhead resistance lies at $150. Market conditions permitting, it could easily run back to $170, $180 or higher over the near term". That's my assessment from looking at the fundamentals and the charts, which leads you to the same conclusion. Of course, there is no 100% accurate or reliable analysis in this business, if it turned around (sold off) convincingly, I'd jump out and watch it again. I'm assuming that April-May's whopper of an internet sector correction is done for now, that must hold so I'll be watching the other sector 'generals' - AOL, EBAY, XCIT, CMGI, DCLK, etc. for confirmation. Good trading!, -Steve
