Spell It “R-&-R”
Monday was just
another opportunity for some more r&r.
That is, if you’re an
intermediate-term growth stock specialist who insists on buying stocks breaking
out on convincing volume amid some robust action on the part of the Nasdaq Comp.
More holes in the glamours, losers to
the tune of 7 to 1.
Looking @ the Naz, we’ve seen two
distribution days and no accumulation days since the Sept. 1 high, 9% away from
the Monday afternoon low.
At the same time, the Q’s have shown
four distribution days in the last five.
Feature of the day: Blatant
professional selling in bells Nortel, Sun, Oracle, Intel, with the former the
most conspicuous.
The five bells I’m spending the most
amount of time watching these days are EMC
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Nortel
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NT |
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At the margin, these will be the
stocks that tell you the most about institutional sentiment, so vital for any
durable advance.
I wouldn’t spend much time looking at
Microsoft
(
MSFT |
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some time.
Ditto for Nokia
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NOK |
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A negative has been the tone of the
comedown, with the Comp going out near its low of the day in four of the past
five days.
Once again, a positive was seen Monday
in the action of the utes and financials, historically good leading indicators.
B2B continues to show signs of life,
though most issues are smothered by overhead supply and offer unattractive entry
for the player of the intermediate term.
For newer, intermediate traders, it
helps to look at each year as a unique learning experience.
Nineteen ninety-eight, for example,
was a year in which many rules were rewritten on the upside; rules pertaining to
valuation, rules pertaining to how high a press release could launch a stock
with no earnings, etc.
That year was capped by a December in
which all the rules that were rewritten during the year were rewritten all over
again.
That was also the last year in which
the "momentum player" was ridiculed by the media.
For at that point, the media had a new
whipping boy, the "daytrader."
Thus far, 2000 is the year of the
start ‘n stop.
I.e., in the aftermath of the March
10-May 24 Nasdaq slide of 41%, stocks set up, break out, fake out, pull back.
The point here is to look at each of
these periods as a learning experience that only adds to your knowledge and
skill set.
The danger is to look at something
that happened in the market recently and expect it to repeat itself right away.
This seldom happens.
Among the names, Manugistics
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broke down decisively from its weeklong symmetrical triangle, offering swing
traders clear entry.
Marvell
(
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potent performers of the past two weeks, wasn’t immune to the markdowns, off for
the second day.
Juniper
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for the fourth time in five outings…not a good sign for one of the leaders of
the August run, yet not abnormal for a stock that had bolted so far, so fast.
Cisco
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distributed for the fourth time in five days.