The rotation continues
The rotation out
of tech continued Thursday, as monies moved into
everything-but-tech.
Among senior
computer names, Sun [SUNW>SUNW], after breaking near-term support
Wednesday, kissed its 50-day MA for the second day…in July, August, and
October, the stock grazed the 50-day before finding support and heading
higher…IBM [IBM>IBM] continues to hold up well.
In color=#008000>cyberspace, they took down both the good and the
bad…leaders like Yahoo! [YHOO>YHOO], CMGI [CMGI>CMGI], and DoubleClick
[DCLK>DCLK] stood as deep in red ink as Amazon [AMZN>AMZN] and
RealNetworks [RNWK>RNWK], poor actors in recent weeks.
The color=#008000>genomics enjoyed a good day. There was just one name
in the group off >3%…Millenium [MLNM>MLNM] rose 15%, Hyseq
[HYSQ>HYSQ] advanced 17%, and Gene Logic [GLGC>GLGC] was ahead 7%…As I’d
mentioned recently, this group could be a major beneficiary of the rotation away
from the computer complex…Growth players, be they mutual funds or individual
investors, need something to funnel their money to…The healthcare sector has
often filled the void created by a tech correction.
Meanwhile, the sophisticated
intermediate trader will keep a sharp eye peeled for stocks that are holding up
amid the flow of red ink…For example, in the telecom
equipment group, there’s a big difference between stocks like Adtran
[ADTN>ADTN], Copper Mountain [CMTN>CMTN], Netoptix [OPTX>OPTX], and
Tollgrade [TLGD>TLGD]Â — and Nortel [NT>NT], Ericsson
[ERICY>ERICY], WorldCom [WCOM>WCOM], Motorola [MOT>MOT], and Lucent
[LU>LU].
Also, take a look at some of the
glamours like Redback [RBAK>RBAK], Brocade [BRCD>BRCD], and JDS
[JDSU>JDSU]. Then take a look at Broadvision [BVSN>BVSN], Chemdex
[CMDX>CMDX], Vitria [VITR>VITR], and Commerce One [CMRC>CMRC]. Big
difference.
Now more than ever, the trader’s job,
then, is to separate the wheat from the chaff.
Pity the market forecaster who must
appear on television or in front of clients on a daily basis…He or she must
spew forth some kind of market forecast–whether or not the crystal ball is
clear that day, that week, or that month…Most of us, however, aren’t burdened
with that responsibility.
And therein lies one of the beauties of
just letting the market tell its own story: It’s simply not necessary to try and
forecast where the Dow or Nasdaq will be a month from now — observing what the
big averages and individual leaders are doing RIGHT NOW is all that’s
critical.
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