Shaken, Not Stirred

June 12, 2000
Dave Baker

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Intraday Trendlines for Daytrading Part I, is also available now.

After last week’s enthralling low-volume consolidation, I was hoping to see
some action. With triple witching this week and the Nadsaq stuck in a trading
range, it’s likely that we’ll need something to get us moving again.Â As
earnings season slowly approaches, we are likely to see a catalyst jumpstart the
market eventually, and it may be what we are hoping for. Unfortunately, it’s
very rare to see a positive pre-announcement, so it’s more likely that we’ll see
several negative warnings. Don’t worry, it’s not as bad as it sounds. What if
lots of small speculative companies warn? What will happen? In a perfectly sane
and logical world, people will move their money out of the speculative bubble and
back into the big names, which may ultimately lead the market again. Of course,
there’s no money-back guarantee on this theory. Only time will tell.

Today’s Updates:Â
(
CRA |
Quote |
Chart |
News |
PowerRating)

Celera
(
CRA |
Quote |
Chart |
News |
PowerRating), in the
biotech group, is still consolidating above its breakout level. Look for a move
above the June 6 high when considering going long. With the biotechs so far off
their highs, there may be more opportunities in low-level setups than in waiting
for something more secure.

Genetech
(
DNA |
Quote |
Chart |
News |
PowerRating) is also
consolidating near its breakout level, but has yet to break through. Watch for a
move above the June 6 high as well. The next resistance level is near 147, the
100-day MA. When trading any biotech, I always like to get a feel for the
standing of the entire group, and they do frequently move together. Remember,
because this is a low-level setup, there is quite a bit of overhead resistance,
so be prepared to lock in your gains quickly. I try to use a tighter-than-normal
stop when trading anything that I deem speculative.Â

Molex
(
MOLX |
Quote |
Chart |
News |
PowerRating) has
traced a beautiful flag pattern after bouncing off its recent lows. The flag
appears to have bottomed along the 50-day MA. There are two ways to trade this
pattern. Aggressive traders may consider a break above the top of the flag
pattern as a buying opportunity. In this case, look for some resistance near the
top of the flagpole. The more conservative trader would wait for a move above
the top of the pole. In this case, it appears that there may be some leftover
resistance near the top of the pole from several weeks ago. Set your alerts just
over 56.

Vitesse Semiconductor
(
VTSS |
Quote |
Chart |
News |
PowerRating)
has traced out the same pattern as so many tech stocks. Despite this fact, I
like to place alerts on several of these setups, because you never know which
one will move. Watch for a move above 76 1/4 as we watch for a breakout. The
next resistance level was set back in April, near 90. In the case of a breakout,
watch for a move first to 80 and then to 90. The five-day MA has been guiding
Vitesse higher as it rallied off its lows, so it may be able to push it through
resistance in the near future. Take note of the five-day consolidation that took
place following the gap up two weeks ago. It may take another gap to push it higher.

In today’s bargain basement section, we find another chart
similar to that of Vitesse, but at only one-fifth the price! Looking at Net2000
Communications
(
NTKK |
Quote |
Chart |
News |
PowerRating) we find another low-level setup. Set yours alerts for
a break above 17 1/2. On a breakout, watch for resistance at 20, 21, and 22.

Today’s Shortlist:
(
CC |
Quote |
Chart |
News |
PowerRating)

Circuit City
(
CC |
Quote |
Chart |
News |
PowerRating) a tech stock per se, but it is frequently talked about
in technology reports, so it’s only fair that we give it a moment in the
spotlight. This technology retailer plowed through support last week on
stronger-than-average volume. On Monday it was able to bounce off its weekly
support level. Look for a closing move below this longer-term support when
searching for shorting opportunities. Watch for a break below 34 1/2. Watch for
bounces near 30 and 25.

Until this afternoon,

Dave Baker

Check back at 2:00PM
ET for Trading The Techs P.M.

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Shaken, Not Stirred

BUY THE FEAR, SELL THE GREED

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