Bell Underwethers

  • October 6, 2000
  • Dave Baker

Qualcomm
(
QCOM |
Quote |
Chart |
News |
PowerRating), which I mentioned in Thursday’s PM article, broke out as I
hoped. The stock took out Wednesday’s intraday high with little trouble and quickly traded higher. If you were able to catch that move, you would most
likely have been taken out before the close with a trailing stop. QCOM hit
resistance from April/May. Friday, we will watch for a breakout above that key
resistance level to offer another short-term trading opportunity.

Today’s Tech Watchlist:
(
SCMR |
Quote |
Chart |
News |
PowerRating),
(
PMCS |
Quote |
Chart |
News |
PowerRating)

The continued weakness in
the leaders of the last tech rally continues to hold down the indices. Let’s
take a look at two of those names today.

Sycamore Networks
(
SCMR |
Quote |
Chart |
News |
PowerRating)
systems moved lower on thick trade on Thursday. The close below the support
level which bolstered the stock on several occasions may provide a short
opportunity. Bigger-picture charts trace out somewhat of a head-and-shoulders
pattern. Thursday’s price action reflects a break of the neckline. The volume
action suggests that the move may continue. Set your alerts near Thursday’s
intraday low and watch for a continuation move lower to lead to a short
opportunity. 

 

PMC Sierra
(
PMCS |
Quote |
Chart |
News |
PowerRating)
closed just over support on Thursday after bouncing a bit during the close. This
is the third test of this near-term trendline. The break of psychological
support at 200 was quick and painful. I watched the stop orders flood my time
and sales screen with a sea of red. A few buyers came into the stock at the
intraday low and pushed it higher. 

At this point, we will
watch for a break of this near-term support level to offer a short opportunity.
If PMCS musters some strength, it will most likely have a bit of trouble near
200. In a weak market, it will be unable to take out this level and possibly
retest the intraday low from Thursday. Set your alerts near this level and watch
for a short opportunity based on a breakdown.

 


Until later, 

Dave Baker