Will People Ever Learn?
Will people ever learn? I was watching a
business report last night, and naturally they dragged out some "Portfolio
Strategist" from one of the major firms for his view going forward. His
response, and this is no exaggeration: "Since stocks have fallen so much,
we feel they can go up quite a bit from here." My wife had to practically
pin me to the couch. I could not believe that the interviewer did not ask why
they had to go back up. Just because they have fallen is irrelevant. Worldcom
(
WCOM |
Quote |
Chart |
News |
PowerRating) has fallen a lot, that does not mean you rush in and buy. The sad
fact is that most of these analysts are very smart individuals who certainly
possess the ability to offer insightful investment commentary. In this day,
someone who produces exemplary research will have more business than they know
what to do with, yet these same analysts would rather tow the party line.
Granted, this has zero effect on the way I trade on a daily basis.
Nonetheless, it is truly stunning to see what passes for investment analysis. I
invite any of the major media companies to interview me on my thoughts on the
market. I will guarantee no sound-bite answers and will give my best effort at
explaining where the markets currently stand. That would be a revolution in
financial broadcasting. So, if any media programmers out there see this, feel
free to give me a call. I will put on my best pair of jeans and iron my T-shirt
(standard daytrader attire) before getting in front of the camera for an
honest-to-goodness approach on fundamental and technical analysis. I will now
step down from my soapbox.
Turning to yesterday’s action, I have to admit I did very little trading due
to some unforeseen circumstances. However, the range appeared narrow, and after
talking with some of the traders in my office, they indicated it was not a real
barnburner. Today, we have a few items to chew on which may add a bit of
volatility:
- The release of the unemployment report, which was a bombshell.
- Comments from Greenspan regarding proper accounting of stock options.
- A bombshell from Vodafone
(
VOD |
Quote |
Chart |
News |
PowerRating) on
its outlook. This will probably have a ripple effect in the whole telecom
sector. In fact, Vodafone has traded half of all the volume of the FTSE,
500+ million shares.
Naturally this blows a temporary hole in all the glowing reports that have
been emanating from Wall Street regarding the strength of the US economy and
corporate profits. This should translate into some good price action early on. I
plan to keep an eye on VOD for some
opportunities. Naturally, the SOX will continue to be a good barometer for
intraday swings, especially as it flirts with the February lows.
Key Technical Numbers: (SOX)
| 520 |
| 514-15 |
| 503 |
| 491 |
| 481 |
Key Technical
Numbers (futures):
S&Ps |
Nasdaq |
| 1108 | 1255-59 |
| 1096-97 | 1248 |
| 1090 | 1228 |
| 1085 | 1204-07 |
| 1070-72 (confluence) | 1176-77 |
| 1062 (contract low) | 145 |
| 1052 |
As always, feel free to send me your comments and
questions. See you in TradersWire.